response to queries raised by the jsc 15th oct 2013b

7/27/2019 Response to Queries Raised by the Jsc 15th Oct 2013b

1/73

1 | P a g e F I N A L R E P O R T G B S / J S C 1 5 T H O C T 2 0 1 3

FINAL REPORT

BY

RESPONSE TO QUERIES RAISED BY THE JUDICIAL

SERVICE COMMISSION

GLADYS BOSS SHOLLEI, CBS

ADVOCATE OF THE HIGH COURT OF KENYA

DIP KSL, LLB,LLM,MBA

CHIEF REGISTRAR OF THE JUDICIARY/ACCOUNTING OFFICER OF THE

JUDICIARY/ADMINISTRATOR OF THE JUDICIARY FUND/SECRETARY OF

THE JUDICIAL SERVICE COMMISSION


2/73


RESPONSE TO QUERIES RAISED BY THE JUDICIAL SERVICE COMMISSION

DATED 10TH SEPTEMBER 2013

INTRODUCTION:

1. From the onset and before proceeding to answer the queries in detail, Iwish to clarify that it is my honest, professional and legal opinion that

the Judicial Service Commission (JSC) and the Judiciary are according to

the Constitution and other relevant laws, separate and distinct

entities with different mandates. One is an Independent

Constitutional Commission; the other is an arm of Government.2. The JSC is established under Article 171 of the Constitution. It is an

independent Commission as provided under Article 248. It is in

accordance to Articles 253, a body corporate with perpetual

succession. It is therefore distinct from the Judiciary.

Mandate of the Judicial Service Commission

3.Article 172 (1) of the Constitution lays down the JSCs functions asfollows:

172. (1) The Judicial Service Commission shall promote and

facilitate the independence and accountability of the judiciary and

the efficient, effective and transparent administration of justice and

shall

(a) recommend to the President persons for appointment as

judges;


3/73


(b review and make recommendations on the conditions of

service of

(i) judges and judicial officers, other than their remuneration;

and

(ii) the staff of the Judiciary;

(c) to appoint, receive complaints against, investigate and

remove from office or otherwise discipline registrars,

magistrates, other judicial officers and other staff of the

Judiciary, in the manner prescribed by an Act of Parliament;

(d) to prepare and implement programmes for the continuingeducation and training of judges and judicial officers; and

(e) to advise the national government on improving the

efficiency of the administration of justice.

The four point mandate articulated above is the core business of the JSC.

The Judicial Service Actthrough section 13 further expounds on the

role of the JSC. It provides as follows:

13.(1) In addition to the powers of the Commission under Article

253 of the Constitution, the Commission shall have the power to -

(a) purchase or otherwise acquire, hold, charge and dispose of

movable or immovable property;

(b) borrow and lend money;

(c) enter into contracts

(d) do or perform all such other things or acts necessary for the

proper performance of its functions under the Constitution and this

Act which may be lawfully done or performed by a body corporate.


4/73


In addition the JSC is tasked with developing regulations for the better

administration of justice under section 47 of the Act. It provides as

follows:

47.(1) The Commission may make regulations for the better

carrying out of the purposes of this Act.

(2) Without prejudice to the generality of subsection (1), such

regulations may provide for

(a) the code of conduct and ethics for judges, other judicial officers

and staff;

(b) the administration and management of the services and

facilities of the Commission for the discharge of judicial functions;

(c) preliminary procedures for making any recommendations

required to be made under the Constitution;

(d) the financial procedures of the Commission;

(e) orientation and training for judicial officers and staff;

(f) the management of issues of conflict of interest;

(g) performance appraisal system of the Judiciary;

(h) the security of judicial officers and staff; and

(i) mainstreaming of gender and regional equity in the Judiciary.

(3) Regulations made under this section shall be presented to the

National Assembly for debate and approval before they take effect

Mandate of the Chief Registrar of the Judiciary

4. The Constitution of Kenya provides for the mandate of the ChiefRegistrar of the Judiciary as follows:


5/73


Article 161 (2) (c) Chief Registrar of the Judiciary, who shall be

the Chief Administrator and Accounting Officer of the Judiciary.

Article 173. (1) There is established a fund to be known as the

Judiciary Fund which shall be administered by the ChiefRegistrar of the Judiciary.

Art.171(2)(3) The Chief Registrar of the Judiciary shall be the

Secretary to the Commission.

5. The Judicial Service Act expounds on the mandate of the Chief Registrarof the Judiciary. Section 8(1) provides as follows:

In addition to the functions conferred by Article 161 of the

Constitution, the Chief Registrar shall, in particular

(a) be responsible for the overall administration and managementof the Judiciary;

(b)perform judicial functions vested in the office of the Chief Registrar bylaw;

(c)exercise powers vested in the office of the Chief Registrar by virtue ofany law or regulation and give effect to the directions of the Chief

Justice;

(d)account for any service in respect of which monies have beenappropriated by Parliament and for which issues are made from

the exchequer account;

(e) be the authorized officer for the Judiciary, who shall beresponsible for the efficient management of the day-to-day

operations and administration of human resources in the judicial

service;


6/73


(f)be in-charge of support services in the Judiciary and in particularplanning, and development, and the organization of staff;

(g)monitor and enhance administration and office procedures tomaximize on efficiency and the quality of service;

(h) plan, prepare, implement and monitor the budget and collect,receive and account for revenue;

(i)prepare reports and proposals on administrative issues;(j)beincharge of the procurement of all stores, and the management

and maintenance of all physical facilities;

(k) maintain and develop co-operation with key staff in the publicservice and other institutions and agencies; and

(l)ensure the efficient devolution of the administrative units tocounty levels, including a High Court Division in each county;

(m) perform such other duties as may be assigned by the Chief Justicefrom time to time.

6. The Public Finance and Management Act provides as follows:66. (1) Subject to the Constitution, the accounting officer of the

Judiciary, Parliamentary Service Commission constitutional commissions

and independent offices shall monitor, evaluate and oversee the

management of public finances in their respective entities, including

(a) the promotion and enforcement of transparency, effective

management and accountability with regard to the use of public finances;

(b) ensuring that accounting standards are applied;

(c) the implementation of financial policies in relation to public

finances;


7/73


(d) ensuring proper management and control of, and accounting for,

their finances in order to promote the efficient and effective use of

budgetary resources;

(e) the preparation of annual estimates of expenditures;

(f) acting as custodian of the entity's assets, except where provided

otherwise by any other legislation or the Constitution;

(g) monitoring the management of public finances and their

financial performance;

(h) making quarterly reports to the National Assembly on the

implementation of their budget; and(i) taking such other actions, not inconsistent with the Constitution, as

shall further the implementation of this Act

Accountabilityfor Judiciary Funds

7. The Constitution provides under Article 226 (2)(3)as follows:226(2) Theaccounting officer of a national public entity is

accountable to the National Assembly for its financial management,

(3) Subject to clause (4), the accounts of all governments and State

organs shall be audited by the Auditor-General.

8. The Public Finance and Management Act mandates the Chief

Registrar as follows:

68. (1) An accounting officer for a national government entity,

Parliamentary Service Commission and the Judiciary shall be

accountable to the National Assemblyfor ensuring that the resources of


8/73


the respective entity for which he or she is the accounting officer are used

in a way that is

(a) lawful and authorised; and

(b) effective, efficient, economical and transparent.

9. Accountability to the National Assembly is practically exercised

through the Internal Auditor General at National Treasury, the Kenya

National Audit Office (KENAO), the Auditor General, Controller of

Budget, the Budget and Appropriations Committee, the Justice and Legal

Affairs Committee and the Public Accounts Committee (PAC) of the

National Assembly.

10. In terms of procurement, The Public Procurement and Oversight

Authority(PPOA) established under the Public Procurement and

Disposal Act 2005 (PPDA) has the responsibility under section 9 to

ensure that the procurement procedures established under the Act are

complied with.

Oversight by the JSC Over The Judiciary

10.Although the JSC exercises supervision over the JSCs own budget andresources it has no supervisory role over procurement, financial

management or expenditure of the Judiciary budget. That

notwithstanding, the JSC does have input in the Judiciary budget asprovided by section 49(2) of the Judicial Service Act but not in the

implementation of the budget once approved by Parliament. The day to

day management of the Judiciary falls directly under the mandate of the


9/73


Office of the Chief Registrar under the Judicial Service Act which

outlines the legal duties and responsibilities

11.Section 68(2)(f) of the Public Finance and Management Act statesthat the accounting officer shall bring any matter to the attention of

the Cabinet Secretary responsible for the entity, or the Chief

Justice or the Speaker of the National Assembly if, in the

accounting officer's opinion, a decision or policy or proposed

decision or policy of the entity may result in resources being used

in a way that is contrary to subsection (1) . The Act goes on to

provide through section 68 (3) that If the concerns referred to insubsection (2) (f) are not adequately addressed by the Cabinet

Secretary or the Chief Justice or the Speaker of the National

Assembly, the accounting officer shall bring those concerns to the

attention of Parliament. Therefore the law does not contemplate the

accounting officer of the Judiciary reporting to the JSC on financial and

procurement matters.

12.Any allegation of impropriety by an accounting officer is provided forby the Public Finance and Management Act. Section 74 (2) (b)

provides that if the Cabinet Secretary believes that the accounting

officer has engaged in improper conduct in relation to resources of the

entity he/she shall refer the matter to the relevant office or body in

terms of the statutory and other conditions of appointment or

employment applicable to that accounting officer. In other words the

Cabinet Secretary of the National Treasury has to refer the matter such

as this particular one to the JSC.


10/73


13.In suspected cases of procurement malpractices, section 102of thePublic Procurement and Disposal Actempowers the Director-General

of the Public Procurement Oversight Authority to order an

investigation of procurement proceedings for the purpose of

determining whether there has been a breach of law. It states that the

investigation shall be conducted by an investigator appointed for the

purpose by the Director-General and not by the JSC.

14.From the foregoing it is clear that JSC is a service commissioncomparable to the Teachers Service Commission (TSC) and Public

Service Commission (PSC) set up to primarily to recruit officers as pertheir mandate and do not exercise oversight over the finances or

procurements of the relevant ministries/departments.

15. Furthermore the JSC is a part-time Commission unlike the TSCand PSC and therefore cannot be expected to exercise oversight over

procurement and finances of the Judiciary. Had the law envisaged such

a situation, they would probably be fulltime. The distinction by the Law

makers is rather obvious: TSC deals with over 240,000 teachers and

PSC deals with over 230,000 public servants.

Queries Raised by JSC

16.The queries above-mentioned relate to Failure to exercise prudencein expenditure of public funds resulting into loss of approximately

Kshs 1.2 billion. I honestly have no idea what the loss of 1.2 billion

means in this context. Blacks Law dictionary defines loss as:

diminution; reduction; decrease in value; that which cannot be


11/73


recovered. The JSC, even as it asked me the questions has not explained

what, where and how exact loss of public funds occurred.

17.I note that most of the queries are couched in language suggesting thatthe actions I have taken are irregular, unauthorized, and unjustified.

However, with respect, I wish to differ on such insinuation or

accusation, and confirm that any action taken by myself is in line with

the law, the Judiciary Transformation Framework, the ICT

strategic Plan and annual budget all of which are costed and

approved by the JSC and Parliament. I simply therefore have

implemented a lawfully approved programme based budget. Indeed

the Hon. Chief Justice is always on record reiterating that the Judiciary

Transformation Framework is our North.

18.The Judiciary is not on a spending spree. We are implementing Judiciarypolicies as anchored in the Judiciary Transformation Framework 2012-

2016 (JTF), the State of Judiciary Report 2012 (both approved by the

JSC) and announcements by the Hon. Chief Justice through official

speeches as Head of the Judiciary(Management treats the Hon. Chief

Justices speeches and statements as policy pronouncements). Access to

justice is guaranteed in the Constitution under Article 48 as a right for

all persons. The State is required to ensure the realization of this right,

and to remove obstacles that impede access to justice. Such obstacles

include distance to courts, shortage of judicial officers and inefficiencies

of the court system.


12/73


19.Human Resources: Previously, the Judiciary was grossly understaffedand operated at 47 per cent of the established staff capacity. Since

October 2011 52 superior court judges, 153 resident magistrates, 87

accountants, 27 Human resource practitioners and 14 performance

management officers amongst other administrative staff have been

hired.

20.The primary unit of the Judiciary is the judicial officer. Increase in thenumber of judicial officers automatically means a corresponding need

of infrastructure (physical space, ICT devices) and human resources(court clerk, secretary, administrative officers etc.). Therefore the

additional judicial officers created demand for corresponding increase

of infrastructure and resources. That is why our budget has increased

ten-fold in the last two years I have been in office.

21.Infrastructure: In response to the constitutional and statutory dictatesto the Judiciary to establish a presence in every county, new courts

must be built. With the budgetary allocation from the Government in

the current financial year, the Judiciary will construct a further three

High Courts, raising the number to 23, with priority given to marginal

areas. Subsequently under the World Bank funded Judiciary

Performance Improvement Project (JPIP) 10 High Courts will be

constructed over the next six years. Sufficient budgetary support from

the Government in the next few years would go a long way in covering

the deficit to enable every county to have a High Court. (prefabs and

renovations of the courts)


13/73


22.ICT technology. Section 3 (l) of the Judicial Service Act of 2011 directsboth the JSC and the Judiciary to employ modern technology in their

operations. In this regard the Judiciary hired consultants to develop the

Judiciary ICT Strategic Plan with costings to guide the design and

implementation of technology in the Judiciary. There was wide

stakeholder engagement including the JSC in development of the

Strategic Plan. Furthermore the Judiciary has anchored ICT in the

JudiciaryTransformation Framework by having it as a stand-alone pillar

which illustrates on the importance of ICT on the provision of accessible

and affordable justice thereby the initial huge capital outlay.It is

important to note that the banking industry in the mid and late nineties

invested heavily in technology and some even posted losses during that

period. However, such investment forever changed the banking

industry, from manual to digital. The Judiciary in serving the public

need to invest in technology in order to reap the benefit of timely and

affordable administration of justice.

It is on the basis of the foregoing that the Judiciary budgeted, presented

to the National Assembly and rolled out the ICT infrastructure. The

building of infrastructure seeks to facilitate effective ICT service

delivery. This will cover the Supreme Court, the decentralized Court ofAppeal and High Court stations around the country, the Judiciary

Training Institute, and the magistrates courts. This infrastructure will

modernize the operations of the Judiciary and will ensure timely

disposal of cases and in particular will better facilitate the provision of


14/73


email facilities and Internet connectivity, document transmission and

sharing of data, voice communications, and clean power in the courts.

Already the court stations are sending official reports and returns

through email. The Judiciary successfully rolled out the Election Petition

Case Management System that was key in managing the election

petitions countrywide. A similar system is currently being piloted at the

court of appeal and will soon be rolled out to all high Court stations. The

Judiciary has automated its complaint system through the Judiciary

Service Desk that keeps track of all queries, compliment s and

comments that are handled by the Judiciary Ombudsperson.23.Summary: The Government allocates funds through a budgetary

exercise that involves input of the JSC, Parliament and the National

Treasury. The budget is based on the needs of the institution and is

program based. Therefore the items acquired including ICT and

premises were budgeted for and approved. It is therefore highly

erroneous to term as irregular the spending of budgeted monies. I have

always paid fidelity to the law and abhor flagrant breach or disregard of

any laid down procedure as provided for in legislation and in the

Constitution. I have not knowingly and will not allow any illegality

under my watch.

Despite the foregoing analysis and legal position and without prejudice, I

will proceed to answer your queries in the spirit of immediatetransparency and collegiality, to which I am committed.


15/73


A.ALLEGATIONS OF FINANCIAL MISMANAGEMENT1. RAHIMTULLA PREMISES

a)Security Deposits Equivalent to Six Months Rents, Service Chargeand Parking Fees (Kshs48.7m)

There is nothing irregular in paying security deposit. In fact it is standard

practice in both the public and private sector. The payment of six-month

deposit and six month rent is a condition of the lease. The deposits are

recorded and maintained in a register of deposits for all leases. The

deposit sum is recoverable upon expiry of the lease and therefore

there is no loss.

I have to point out that the landlord was hesitant to lease to the

Government due to our track record of paying rent late and poor

maintenance of premises.

For the record, as the accounting officer, I am responsible under section

68 of the Public Finance Management Act to ensure expenditure iseffective, efficient, economical and transparent.

The stated amount of Kshs 48.7 million paid out to Rahimtulla includes the

following:

Rent July September KSH11.6 million Service Charge July- September KSH3.3 million Security deposit (6 months) KSH32.4 million Parking Fees KSH0.9 million

b)Payment of Funds from the Milimani Deposits Account


16/73


Under Section 75 of the Public Finance Management Act, I am

designated as a Collector of Revenue. I thereafter in accordance with

Section 76 of the aforementioned Act nominated Mr. Wycliffe Wanga, the

Director of Revenue Collection as the collector of revenue I have never

issued him instructions to make any payments from the Deposits Accounts.

(Annex Fin 1 - Memo appointing Wanga as Director Revenue Collection)

However, from time to time in instances when there is no exchequer or the

IFMIS system is down, urgent payments are done from the Deposits

Account and the refunds undertaken as soon as the exchequer is issued and

Judiciary has funds. This is normally reported to the Kenya National Audit

Office and will be answered as an audit query; which is that the monies

have been refunded and that there were justifiable reasons for the action.

This report has already been made. It is common knowledge and practice

in the public service that there exists challenges of late exchequer and

incessant service providers demanding payments.

Occasion has arisen where we have negotiated with Treasury surrender of

revenue in exchange for exchequer release to the Judiciary. (Annex Fin2

Attached letter to Treasury)

c) Alleged Delegation of Accounting Officer Duties to NicholasOkemwa.

I have not in any way whatsoever delegated accounting duties to persons

within my office. Whenever I am away I delegate accounting powers to the

Deputy Chief Registrar of the Judiciary, Mr. Kakai Kissinger in accordance

with section 11 of the Judicial Service Act.


17/73


The misunderstanding may have arisen due to the restructuring of the

office of the Chief Registrar of the Judiciary. Previously the Office of the

Registrar of the High Court only had a secretary. With the expanded

mandate of the Chief Registrar, it would be impracticable to expect as

rightly recognized by the JSC, the incumbent to deal with each and every

issue that comes to the office. The Office is now staffed with competent

officers who liaise with other offices within the Judiciary to ensure the

Chief Registrar meets the targets of the service level agreement.

d)Alleged Irregular Purchase of Second Hand Furniture and Fittingswithout Approval of Commission and Without Due Diligence.

As previously stated, the JSC and the Judiciary are distinct and separate

entities. The JSC does not have oversight over procurements by the

Judiciary and therefore the approval of the Commission on Judiciary

procurement decisions is not required under the relevant legislation. As

the accounting officer, I am not involved in actual procurement

decisions. I do not sit in the tender committee and my role is limited to

establishing the tender and procurement committees of the judiciary as

stipulated in regulation 7(a) of the Public Procurement and Disposal

Regulations 2006.

The report from the Director of Supply Chain Management states that there

was no irregularity and due diligence was observed in the acquisition of

the furniture and fittings as follows: (Annex 1 SCMS Report from DSCMS)

The Judiciarys Tender Committee awarded the tender of lease of office

premises to Rahimtulla Trust (Rahimtulla Towers.). During one of the

inspection visits to Rahimtulla Towers, the occupants at that time, Price


18/73


Waterhouse Coopers (PWC) had not yet vacated the premises and the

Judiciary was made aware that PWC could sell the office fit outs as they

existed.

The other option was to demolish the entire structure and leave an open

space (core and shell) for the next tenant. The Judiciarys management

decided to pursue the option of acquiring the office fit outs as there would

be enormous savings in terms of cost and the time required to tender and

fit new structures. The process of direct procurement was thus

commenced in accordance with Section 29 (3) and Section 74 (2) of the

Public Procurement and Disposal Act 2006 (PPDA). (Annex SCMS 2)

Section 29(2) of PPDA provides that a procuring entity may use an

alternative procurement procedure only if that procedure is allowed under

Part VI. Section 29(3) further provides that a procuring entity may use

restricted tendering or direct procurement as an alternative procurement

procedure only if, before using the procedure, the procuring entity (a)

obtains the written approval of its tender committee (b) records in writing

the reasons for using the alternative procurement procedure. The

procurement process started with the Tender Committee first approving

the procedure and commencement of negotiations after determining that

the relevant condition set out in section 74(2) of the Public Procurement

and Disposal Act, 2005 had been satisfied. Regulation 10(2) (l) of Public

Procurement and Disposal Regulations (PPDR) (Annex SCMS3)mandates

the tender committee to approve negotiations (Annex SCMS 4 JTC Minutes)

Section 74 (2) of PPDA provides that a procuring entity may use direct

procurement if the following are satisfied (a) there is only one person who


19/73


can supply the goods, works or services; and (b) there is no reasonable

alternative or substitute for the goods, works or services. The fit outs

belonged to PWC and they were the only people who could supply them.

There was no reasonable alternative or substitute as the only other

alternative which was considered unreasonable was for PWC to demolish

all the structures and the Judiciary goes through the process of design,

tendering and construction which would have taken 8-12 months while at

the same time paying rent for an unoccupied building as was the case with

the Partitioning works for the JSC Mayfair Offices which took 2 years .

By making a decision to buy the fit outs, the rent paid would not go towaste as the building would be occupied immediately.

In accordance with Regulation 8(3) (i) of PPDR, the procurement unit

recommended a negotiating team for appointment by the accounting

officer. The negotiating team held a meeting with PWC and the outcome of

the meeting resulted in a further discount for the assets that were to be

purchased by the Judiciary from the initial valuation report for the

furniture and fittings of Kshs 32,550,000 to Kshs 30,000,000 plus taxes,

where applicable. During the negotiations PWC insisted that the

workstations were part of the office fit-out as they were interconnected

and had provisions for ICT structured cabling, therefore dismantling the

work stations would result in losses for the seller (PWC.) They were also

adamant that they would only sell the fit-outs if The Judiciary was ready topurchase the rest of the furniture since the furniture was meant to be used

as a unit. (Annex SCMS 5 negotiations minutes)


20/73


To ensure value for money, The Judiciary engaged Jomo Kenyatta

University of Agriculture and Technology (JKUAT), a public institution to

carry out valuation of the office fit out, furniture and fittings. Additionally,

the Directorate of Supply Chain Management carried out a market survey

to establish the cost of new office fit outs as well as new furniture. (Annex

SCMS 6 BQs from JKUAT and the market survey for furniture).

The Judiciary made savings of Kshs 70,000,000/- by acting prudently

and with all due diligence in making the award decision.

e)Lease of Rahimtulla without Authorization of CommissionApproval of the Commission is not required to lease premises for the

Judiciary as the two are separate and distinct entities. Under the terms of

my appointment letter as the Accounting Officer, I am solely authorized to

enter into contracts on behalf of Judiciary provided the same has gone

through due process. However, the JSC was aware of the intended lease

from my presentation to them on 15th

of January 2013 and furthermore theprocurement was through open tender that was advertised through the

local dailies.

f)Allegedly Leased Premises when they were not neededOnce a policy decision to hire additional staff including judges has been made

by the JSC, it means that the cost of the wages and resultant resources have to

be budgeted for. For instance the medical insurance premium has to be

increased, additional office space has to be obtained, and computers have to

be purchased. Additionally if more judges are hired it means extra vehicles,


21/73


extra fuel expenses, additional secretaries, additional administrative staff and

so on.

The premises in question were/are urgently needed since the Supreme Court

building is required to undergo structural repairs and to alleviate the

overcrowding in the premises, which run counter to the provisions of the

Public Health Act. It is important to note that the Supreme Court building

was built in 1930 and has subsequently been declared a national monument

vide Gazette Notice no 2079 of 1996.(Annex SCMS 7). It is therefore a

building that has to be preserved and maintained in accordance to standards

set by the National Museums Act (formerly The Antiquities and National

Monuments Act). You will note that the building has cracks and part of it may

collapse at any one time. Indeed the Hon. Chief Justice in his recent

communication to the Court of Appeal judges confirmed that there were

dangerous cracks and defects in the building that necessitated their

movement to Elgon Place in Upperhill(Annex SCMS 8 CJ Email authorizing

movement to Rahimtulla)

It is important to note that the old Court of Appeal building in Mombasa did

not undergo structural repairs in time and is now in dire straits. It has since

been completely taken over by the National Museums of Kenya. The adage a

stitch in time saves nine. (Annex SCMS 9Mombasa Court Report)

Rahimtulla premises will be occupied by the following:

Directorate Supply Chain Management- 27 people Finance and Accounts Directorate - 35 people Internal Audit - 7 people


22/73


Kenya National Audit Staff 6 people Human Resource and Administration Directorate 38 people Directorate of Performance Management Directorate of Revenue Collection UNDP Project Management Unit - 7 People Project Management Unit (JPIP)- 20 people Independent Fiduciary Agent (JPIP)- 14 people KMJA Secretariat KWJA Secretariat NCAJ Secretariat Political Parties Tribunal -12 people Auctioneers Licencing Board Tribunals -The Judiciary is in the process of taking over all tribunals

(approximately 17) as required under the Constitution. Some will be

housed in Rahimtulla.

g)Allegation that the Lease for Rahimtulla was not Registered.The registration of the lease is ongoing as the executed documents are with

the landlords advocate for lodging at the Lands Office in accordance with

conveyance practice.

h)Allegation that there was no Market Valuation for Rahimtulla?The Directorate of Supply Chain Management carried out a market survey

to determine the average rental charge of office premises around Upper

Hill area in accordance with Regulation 8 (3) (z) of PPDR 2006. The market

survey established that the rent payable per square feet was within the


23/73


market range and this informed the Tender Committees Decision to award

the Contract for leasing of office premises to Rahimtulla Trust. The cost per

square feet was Kshs 100 (Annex SCMS 10 Market Survey for Rahimtulla

Trust) Furthermore the Judiciary leased the premises at the exact same

costs as the previous tenants PriceWaterhouseCoopers and was sourced

through open tender.

It should be noted that JSC Mayfair premises was sourced two years ago

and cost Kshs 124 per square foot. Due diligence of the latter was

undertaken by Commissioner AhmednasirAbdulahi and Commissioner

Emily Ominde(Annex SCMS 11- JSC Minutes)

2. VOMORONO (LIBRA HOUSE) WAREHOUSEa)Alleged Lease Agreement without Authorization of CommissionAs stated before the approval of the Commission is not required to lease

premises for the Judiciary it falls within the mandate of the accountingofficer. However the premises were acquired through open tender and was

advertised in the local dailies as the PPDA (Annex SCMS 12 Advert Lease of

office Space).

b)Validity of TitleThe title is valid. The JSC erroneously relied on the cancelled version of the

lease instead of the final corrected version. The cancellation in the title was

done by the lands office on the basis of misspelling of the lessors name. The

document relied by the JSC was deliberately edited to conceal the

correction for purposes of either trying to build a case against me or other


24/73


reasons best known to JSC. Find attached the registered lease. (Annex SCMS

13Lease for Vomorono Warehouse)

c)Allegation that there was no Market Valuation for VomoronoWarehouse.

The Directorate of Supply Chain Management carried out a market survey

to determine the average rental charge of office premises around Industrial

Area / Mombasa Road in accordance with Regulation 8 (3) (z) of PPDR

2006. The market survey established that the rent payable per square feet

was within the market range and this informed the Tender Committees

Decision to award the Contract for leasing of a warehouse to M/s

Vomorono Ltd. (Annex SCMS 14Market Survey for Vomorono Warehouse)

Furthermore, the premises were acquired through open tender and was

advertised in the local dailies as per the PPDA.

d)Allegation that there is no need for Vomorono WarehouseThere is an urgent need to have warehouse premises not only in

Nairobi but in regions across the country. The Records Disposal

ActCap 14 provides a schedule for records retention and disposal

including procedures for disposal. The Records Disposal (Courts) Rules

provides that the records relating to family matters such as administration

of estate and right to heirship should not be destroyed. The general rule is

that the records, books and papers relating to civil court proceedings can

only be destroyed after 12 years from the date of final judgment or order.

On the other hand, financial records are also to be stored for a minimum of

7 years.


25/73


The current storage of court and financial records is below acceptable

minimal standards to ease retrieval for audits or reconstruction of records.

The records are being stored in basements, corridors and other unsuitable

places that not only congest the courtrooms but expose the records to

undesirable elements of nature, including snakes, hedgehogs, rats and

termites.

The Auditor General has on occasion given a disclaimer of opinion on the

Judiciary Audit as they have been unable to obtain all financial records

necessary to make an opinion. This is usually due to the inability to retrieve

Payment Vouchers or contract documents for verification by the auditors

on time. Proper storage, recording and cataloguing in a well designed

warehouse will resolve this audit issue as the Judiciary works towards

obtaining an unqualified audit opinion.

e. Allegation that Vomorono Lease is not registered

The lease was registered. Find attached the registered lease. The titledocument that JSC relied on was deliberately edited to remove the entry of

the lease registration.(AnnexSCMS15)

3. ELGON PLACEa)Allegation that lease was entered without valuationThe Directorate of Supply Chain Management carried out a market survey

to determine the average rental charge of office premises around Upper

Hill area in accordance with Regulation 8 (3) (z) of PPDR 2006. The

market survey established that the rent payable per square foot was within

the market range and this informed the Tender Committees Decision to


26/73


award the Contract for leasing of court premises to Knight Frank Ltd.

(Annex SCMS 16Market survey for Rahimtulla Trust and Elgon Place).

Furthermore the premises were acquired through an open tender process

which was advertised in the local dailies. (DittoAnnex SCMS 12)

b)Alleged Irregularities and Inconsistencies of Lease Document(i) That documents are not properly dated

JSC is relying on outdated draft documents. Both the head of

terms and the lease agreement are dated. Find attached the actual

documents (Annex SCMS 17)

(ii) That they are not under the seal of the JudiciaryThe lease has been executed by the accounting officer as per the

law.

(iii) That the documents are not properly witnessedThe lease agreement has been witnessed by qualified advocates.

(iv) That the signatures are witnessed by unqualified personsThere is a difference between executing documents, witnessing

documents, certifying documents and preparation of documents.

Any person of age who is of sound mind can witness a document

or in other words attest that a party in question truly appended

their signature. In relation to the Head of Terms attested by the

legal counsel in my office, it does not fall foul of the provisions of

the Advocates Act particularly section 34. The duly executed

lease agreement was witnessed by duly qualified counsel.

(v) That there were different lease terms and conditions


27/73


The JSC appears to be erroneously relying on incomplete drafts of

the lease document. Elgon Place has only one lease that was

executed for a term of 10 years. The initial heads of terms which

had a proposed lease term of 6 years was a guide to the final lease

for Elgon Place. The final lease of 10 years was entered into

accordance with the tender document which required the bidder

to provide competitive terms of lease. Originally it was intended

to be a term of six years. However, the delay in acquiring the land

to construct the Court of Appeal and the Administration block

meant the Judiciary had lost two years out of the six years. Inaddition, since the Judiciary intended to partition the entire

building and therefore to maximize the use of the partitions with

an emphasis on value for money. Given the foregoing, the

Judiciary resolved to make an award for a 10 year lease for Elgon

Place. This is due to the fact that the lease was not automatically

renewable and upon expiration of the lease, the Judiciary would

not be in a position to salvage the fit outs which if possible could

have been used elsewhere. (Annex SCMS 18Negotiation minutes

and minutes of the Tender Committee resolving to award lease of

Office Premises to M/s Knight Frank)

(vi) That the Lease was not registered.At the time of receiving the allegations, the process of registration

was ongoing. Find attached the registration

c)Allegation that Payment was made in Foreign Currency


28/73


There is nothing irregular about making payments in foreign currency

equivalent. Standard public bid documents allow bidders to request for

payments in foreign currency. For commercial lease agreements within the

CBD and environs, it is common for the rent to be quoted in USD. The

current selling exchange rate from the Central Bank of Kenya (CBK) is used

to calculate actual amounts payable. Quotations for computers, phones,

airplane tickets and per-diems are in US$ but payment is done in local

currency equivalent.

The difference of 1,183,093/50 was occasioned from the difference

between the KCB rate and the CBK rates. Nevertheless this difference has

been treated as part of the deposit and is reflected in the register of

deposits for all leases.

It is important to note that Section 69 of the Public Finance Management

Act provides for the Accounting Officer of a National Government entity to

writeoff a loss that may have occurred.

d)Allegation of irregular Payment of security depositsThere is no prohibition in the law for paying security deposits; in fact it is

standard practice. The deposits paid were negotiated and are consistent

with the terms of the lease agreement with the landlord. Such payments

are reflected in the deposits account and in a register of deposits for all

leases. As stated earlier, security deposits are recoverable after expiry of

the lease.


29/73


e)Allegation of irregular payment of service charge of Kshs 3.3million even when Judiciary was sole tenant and landlord not

providing services.

The payments made were consistent with the terms of the lease agreement

and therefore there was no irregularity. For clarity no rent was paid for the

period January March 2013. The service charge payable by the Judiciary

includes but not limited to charges for the insurance of the premises,

electricity and water for common parts, external security, sewerage,

cleaning of common parts, ground rent, rates, non-capital repairs,

maintenance of lifts, water pumps, and maintenance of vehicle parking and

delivery areas and management costs charged to the Landlord in respect of

common parts of the premises used by the tenant.

In the real estate industry for the lease of office premises, the service

charge is payable based on the square feet occupied by a tenant. The

premises were identified through an open tendering process which

required the bidders to quote for service charge as it was not anticipated

that the Judiciary would be the sole tenant of premises to be identified. The

terms of the tender document formed the basis upon which the lease was

negotiated and prepared. If the Judiciary knew in advance that it would be

the sole tenant, we would have opted to manage the building instead of

paying the service charge.

In any case we do not have expertise in estate management as evidenced in

the dilapidated court buildings across country caused by years of neglect.

However, under the World Bank Judiciary Performance Improvement


30/73


Project (JPIP) a Facilities Management Unit will be established which will

take over the role of managing premises within the next year or two.

f)Allegation of Double Payment of Rent.This question is picked from the audit queries raised by the internal

auditor and has been resolved and is no longer pending as an audit query.

However the explanation is as follows: The initial payments of

KES43,250,082.10 was made from JTI due to Exchequer delay at

headquarters that forced management to request JTI to pay then be

subsequently reimbursed. JTI paid but the accountants at headquarters

had already processed and lodged all necessary documentation at IFMIS.

The double-payment was immediately detected and amount was off-set

against future certificates for the partitioning/fit-outs.

g)Allegation: That Unauthorised Rents for January-June of Kshs 169,051,914 were paid contrary to terms of lease agreement and in

excess of agreed rent

It is not clear where the JSC obtained this figure of rent amounting to Kshs

169 million. In fact our rent for the period is Kshs34,486,381.75

According to our records, the following was paid out for the period in

question:.

a). Total Service Charge: KES 9,999,432.00b). Total Rent: KES 34,486,381.75

c). Total Deposits KES 19,115,113.65

d). Fit-outs KES 131,546,592.50


31/73


The total amount of KES 195,147,519.90 has been paid as analyzed in the

annexed excel sheet (Annex Fin SealinkReconciliation)

h)Alleged Advance Interim Payments thereby Pre-financingContractor

Advance payment to a contractor is standard practice in the construction

industry as it enables contractors to mobilize on the ground. The Condition

to pay advance payment is borrowed directly from the Public Procurement

Oversight Authoritys standard bid document for building & associated civil

works clause 23.7 which we are required by law to use and is widely used

in public sector projects including the Ministry of Public Works (MOPW)

who have similar conditions in their Bills of Quantities. There is no law out

outlawing advance payment and it can therefore not be illegal.

The advance is recovered progressively as per formula in the PPOA

standard bid document Clause 23.7 The advance payment is however paidagainst a Bank Guarantee of a similar amount thus reducing the risk of

losing the money to zero. The partitioning works have since been

completed and the Judiciary has not incurred any loss. (Annex SCMS

19Extract from the Standard Bidding documents for advance payments)

4.Allegations Relating to Lease of Premises for Court Houses.As mentioned in the introduction, the principle of access to justice as

anchored in the Constitution and the Judicial Service Act behooves the

Judiciary to invest in brick and mortar. Indeed I made a presentation

before the Budget and Appropriations Committee of the national


32/73


Assembly in May, 2013 where I included the proposed leasing of

buildings from Agricultural Finance Corporation (AFC). (AnnexSCMS20 -

Listof premises leased from AFC)

Based on the presentation, the Judiciary was granted budgetary allocations to

lease the premises. This clearly spearheads the JTF in acquisition of adequate

infrastructure for the Judiciary and is the biggest promotion of access to

justice in the history of the Judiciary.

i. That there were no ValuationsMost of the leases for court houses outside Nairobi were contracted with

Agricultural Finance Corporation (AFC), a public institution. I draw your

attention once again to section 4 (2) (c) of thePPDA2005 which states

that the acquiring of services provided by the Government or a department

of the government is not procurement. Therefore, market surveys in

regards to the rental prices do not apply in such circumstances. However,

as is the practice and in a bid to act prudently, the Judiciary carried out a

market survey of the rental prices in the various towns where it had leased

court houses. (Annex SCMS 21- Market Survey for AFC leases)

ii. That No title deeds availed to JudiciaryTitles are issued where a party has purchased the property. The Judiciary

is leasing the premises; no landlord in this jurisdiction will give the title

deed to the lessee.


33/73


iii. That Leases not RegisteredThe leases are currently in the process of registration. The duly executed

documents are with the landlords advocates as per conveyance practice

for lodging at the lands office.

iv. That there was irregular Payment of administrative costs andlegal fees made to landlord

TheAdvocates Actprovides for such payments to be made to the lessors

advocates for registration of the lease and resultant expenses.

5. PRE-FINANCING OF INFORMATION & COMMUNICATIONTECHNOLOGY PROVIDERS (ICT) PROVIDERS.

(i) Lekha Trading CompanyThe procurement for the supply and installation of EPABX cabling at the

Supreme Court building underwent a competitive process. The award was

finalized at the tail end of the financial year. The delay was due to the

restructuring of the Procurement Directorate which led to the interdiction

of the then Chief Procurement Officer and thereafter necessitated the

secondment of officers from the Directorate of Procurement, National

Treasury. Upon coming on board, the new team started off the

procurement process which was finalized at the tail end of the financial

year. Therefore to avoid remitting back the funds to Treasury, Lekha

Trading Company which had won the tender was paid the full amount

against a valid bank guarantee of a similar amount. There was therefore no

exposure to risk to the Judiciary. (Annex SCMS 22Bank guarantee)


34/73


(ii) Alleged Questionable Bank GuaranteeTo the best of our knowledge the bank guarantee is valid.(Annex SCMS 23

letter to the bank)

(iii) Alleged that works are not completedCertain aspects of the works have not been completed to the satisfaction of

the ICT Directorate hence the reason theJudiciaryhas not released the bank

guarantee. (Annex SCMS 24Report of ICT Director).

(iv) Alleged Breach of law by advance payments of 30% to ICTProviders

It is standard practice to pay a certain amount to a consultant/contractor

upon signing of a contract. All payment were paid as per terms of the

contract.

6.ALLEGED IRREGULAR PAYMENT TO SECURITY CONSULTANTSIMIYU WERUNGA

There was no irregular payment. This payment was made in relation to

issue of security concerns of Judges and court premises, inter alia, relating

to the election period as discussed by the Assumption into Office of the

President Committee as provided for by the relevant Act. In accordance

with the laws concerning such security issues, other officers and I signed a

confidentiality agreement and would need a waiver from Office of the

President to give details as it was a national security issue.

7. PREFABRICATED COURT HOUSES.


35/73


a)Alleged Irregular Advance Interim Payment for prefabs for Bomet,Marimanti, Othaya and Wanguru Courts

There was no irregularity. Advance payment to a contractor is standard

practice in the construction industry as it enables contractors to mobilize.

The Condition to pay advance payment is borrowed directly from the

Public Procurement Oversight Authoritys standard bid document for

building & associated civil works clause 23.7 which we are required by

law to use and is widely used in public sector projects including the

Ministry for Public Works (MOPW) who have similar conditions in their

Bills of Quantities. There is no law prohibiting advance payment.

The construction of prefabs takes a different approach, since all or at least

90% of the structure is fabricated away from site in the contractor's

workshop, the advance affirms the client's commitment to the contract.

The prefabricated materials therefore belong to Judiciary but are only

stored in the bonded warehouse which is insured.

The advance payment is however paid against a Bank Guarantee of a

similar amount thus reducing the risk of losing the money to zero. The

advance is recovered progressively as per formula in the PPOA standard

bid document Clause 23.7. (DittoAnnex SCMS 19)

(ii) Alleged Payments to undisclosed payeeThere is no such thing as an undisclosed payee as IFMIS requires the

beneficiary to be defined in the system and have a bank account.


36/73


Payments concerning prefabs were only paid to Economic Housing Group

(EHG) or JKUAT. The annexure provided by JSC had the name of the payee

deliberately edited out.

(iii) Irregular Payment done through JTI instead of Head QuartersThere is no irregularity. Payments are often made upon approval via JTI or

Milimani whenever there is exchequer delay. This challenge is not peculiar

to Government institutions and it is common practice that borrowing from

other sources within the same institution can be done. The amounts are

then refunded by headquarters and posted via IFMIS. The full payment

details of the transaction are captured into IFMIS at point of refund.

b)Irregular payment to JKUAT for prefabricated courtsThere is no irregularity. The Judiciary engaged Jomo Kenyatta University of

Agriculture and Technology (JKUAT) a public institution as Consultants to

design and supervise construction of the prefabricated court buildings in

accordance with the provisions ofSec. (4) (2) (c) of thePPDAwhich states

that the acquiring of services provided by the Government or a department

of the Government is not procurement with respect to which the Act

applies. Contracts were signed with JKUAT and payment conditions were

as per the provisions of the Architects and Quantity Surveyors Act CAP

525 which provide for payment of up to 75% for completion of a detailed

design incorporating the design work done by consultants and for

preparing production drawings and information necessary for Bills of

Quantities. The payments were made after the construction tender process

had been completed which was beyond what the Act stipulates. Interim

payment certificates are normally used while paying contractors and


37/73


not consultants. In the architectural and quantity surveying industry,

interim payment arrangements are allowed between the architects and the

client. In this particular case, JKUAT designed the prefabs and therefore the

interim payments that were being made were in regard to the designs.

However, there is no provision for the submission of interim certificates by

the architects before making payments. The interim certificates are

submitted in relation to the actual works done by the contractor. (Annex

SCMS 25Architects and Quantity Surveyors Act)

8. IRREGULAR MEDICAL EXPENDITURE ON BENEDICT OMOLLOThere is no irregular expenditure. The KES39,284.80 was a refund to

Benedict Omollos former employer, being the medical cover extended for

the period July to September 2012.

The Judiciary had problems with Alexander Forbeswho were then the

medical service provider, and at the time no new staff were being added

into the scheme. The Judiciary was in the process of identifying a newservice provider for the medical scheme. Several other staff had the same

benefit of carrying forward their existing medical scheme until a new

service provider was in place. (Annex Fin 4Letters requesting Medical cover

services)

9. IRREGULAR SALARY ADVANCEThe issuance of salary advances are not irregular but provided for in

Government regulations and JSSR regulations. Salary advances are paid out

to staff based on a request. Attached is a list of staff who have requested for

salary advances. (Annex Fin 5 list of staff with advances).


38/73


(i) Eight month salary advance totaling to 3,539,250The statement that I caused payment of a salary advance of 8

months between 31st October 2012 and 21st November 2012 is

untrue and incorrect.

I wish to clarify that I indeed applied and received a 3 month

salary advance on 20th December 2011 and completed repaying

the same in November 2012. Later I applied for and received a

second salary advance of 2.3 million. I have since repaid 680,000

and have a current balance of 1.6 million. Several Supreme Court

and Court of Appeal judges have had salary advances processed ina similar manner and continue to pay for them in the same way.

It is important to note that I am an ordinary Kenyan of average

means. The salary advance was to enable me to raise the requisite

deposit for the Judiciary Mortgage Scheme just like other Judiciary

staff. The salary advance is not irregularly acquired money.

(ii) Failure to repay salary advanceAlready answered above. Attached find documentation evidencing

payment. (Annex Fin 6 Receipt)

(iii) Salary advance irregularly effected from Judiciary Fundinstead of Consolidated Fund

This is not irregular at all. Owing to the delays in Treasury to

process salary advances and leave commutations for judges, the

Judiciary normally pays out salaries advances, commuted leave


39/73


through the Judiciary Fund due to the urgency of the requests. The

officers then reimburse the Judiciary monies owedas soon as

Treasury effects the payments to their respective accounts.

Attached is a list of salary advances paid out to the judges through

the Judiciary Fund (Annex Fin 7-list of Judges with advances paid

from the consolidated fund).

10. ALLEGED IRREGULAR EARNING OF SITTING ALLOWANCES ATTHE JSC

I have not earned any irregular sitting allowances. Claims for allowances

are generated by the Registrar of the JSC (Annex Fin 8 sample pay

requests) who tabulates the number of meetings attended by individual

Commissioners and the Secretary. Members of the JSC who are present sign

the attendance register then the JSC registrar Mrs. Mokaya crosses out the

names of those who are absent and requests payment for only those who

have signed. Accordingly, I have been paid for the meetings I signed for

according to the JSC Registrar Mrs. Mokaya records and my knowledge. I

wish to repeat I do not generate payments requests.

On learning of this allegation I have severally requested the Registrar JSC to

provide me with minutes so as to ascertain any truthfulness of this

allegation. This information has not, to date, been provided to me.

(AnnexFin9)

As Secretary to the JSC, my role consists of but is not limited to signing

notices for meeting, listing and preparingagendas, ascertaining

documentation to be presented at meetings, supervise the taking of


40/73


minutes and implementing resolutions of the JSC. In instances where the

JSC is conducting interviews from time to time I am summoned to

present/discuss an agenda item or any matters arising.

At this juncture it is important to note that the issue of allowances has been

a thorny issue in the JSC creating negative undercurrents between myself

and some Commissioners.

11. ALLEGED IRREGULAR MERGER OF FINANCE AND ACCOUNTSPORTFOLIOS

12. There was no irregular merger of portfolios. Consultants werehired to help the Judiciary streamline its financial management

processes to incorporate changes in the law brought about by the

enactment of the Public Finance management Act, need to embrace

best practices and identify capacity gaps of the existing staff in the

finance and accounts department. This culminated by a report and

presentation to the JSC Finance and Administration Subcommittee by

the Director of Finance. The restructure of the Directorates was

confirmed by the JSC Commission. They adopted the structure as

presented by the Director of Finance. (Annex Fin 10 Finance Directorate

Restructuring Report

12.IRREGULAR BANK ACCOUNTS.(a) Alleged Irregular and opening accounts.

There was no irregular opening of bank accounts by myself. With the

provision of the Judiciary Fund under Article 173 of the Constitution,

the judiciary was able to exercise some fiscal independence. In order


41/73


to delink from the District Treasury and to better account and track

finances at the Court Stations, we requested court stations to open

separate bank accounts for Deposits (bails), Revenue (Fees and

Fines) and Expenditure (AIE). The Judiciary notified the National

Treasury of the new accounts (Annex Fin 11 Letter informing

treasury of opened bank accounts).

(b) Opening accounts at KCB without Treasury led to loss ofKshs30,500 and 1,183,093.50

Under Section 28 of the JSC Act, the Judiciary can open and maintainbank accounts. (See Section24 of the PFM Act on Parliamentary Fund,

specifically sub-section 12 as Judiciary Fund is established by the

Constitution in Article 173)

Bank accounts in KCB were opened in 2011, for Milimani Law Courts

and JTI. KCB does not charge standard bank charges in the Judiciary

Accounts except for bank transfers. The amount of Kshs 30,500/- is

accumulated bank transfer charges and is carried in the bank

reconciliation. However, this can be expensed as a voucher on a

monthly basis once stations get AIE code for bank charges.

The amount of Kshs 1,183,093.50 arose as a result of exchange

difference between CBK quoted USD and the spot rate used to pay

the landlord. It is recognized that CBK rates are indicative rather

than transactional. There is therefore no loss incurred.


42/73


In discussions with the office of the Accountant General, we were

advised that the Judiciary is a co-equal arm of government. For local

bank accounts, there exists a list of recommended banks. The

Accounting Officer can open accounts and Treasury updated of the

same. A statement of all bank accounts was submitted to the

Treasury.

However, Treasury approval and concurrence is needed for accounts

opened for donors / partner funds. This has been complied with as a

Financing Agreement is signed first as the basis for the accountopening.

(c) Failure to issue guidelines/procedures on monies disbursed toJTI

This question is not clear. The Public Financial Management Act and

regulations thereunder provide guidance on how public finances are

to be managed. Each court station including JTI receives their A.I.E.

certificate which clarifies the amount and usage of money.

The Director JTI should have requisite knowledge of Public Financial

Management Act and regulations since he is responsible for JTI

funds. Indeed the predecessor to the incumbent director of JTI did

undertake a handover process that included briefings, a handover

report and copy of the Public Financial Management Act.

I am not aware that the Director of JTI lacks requisite knowledge of

financial procedures and or management as provided for the Public


43/73


Finance Management Act. However, it would be fair to expect that

any officers who are not familiar with the Public Finance

Management Act to consult the Directorate of Finance on the same.

Notwithstanding the foregoingthe Directorate of Finance recognizes

that since the Judiciary is expanding, it will develop domesticated

financial manual. Under the JPIP work plan for 2012/13 the

directorate of Finance has requested for a consultant to help develop

a Financial Manual that contextualizes the Public Finance

Management Act 2012 and the unique transactions of the Judiciary.

(d) Large payments being made through JTI and Milimani KCBaccounts bypassing IFMIS.

There is nothing irregular from paying from our own accounts

provided it is an approved activity. Payments, large or small, are

made upon approval via JTI or Milimani whenever there is exchequer

delay. The amounts are refunded by headquarters and posted via

IFMIS.

The full transactional details are captured into IFMIS at point of

refund. It is also important to note that due process of approval and

financial controls are still incorporated in payments made on behalf

of Head Quarters by JTI or Milimani.

(e) Unauthorised expenditure of 67,000,000 for judicial marches.


44/73


The Judicial Marches wasthe brainchild of the Hon. Chief Justice and

were organized by a committee comprising of Hon. Mr. Justice

KiharaKariuki, Chief of Staff Duncan Okello, Hon. Prof. Joel Ngugi and

KwamchetsiMakhoka. (Annex Fin 12)

JTI, as the coordinator of the Judicial marches, received an advance

Kshs 67,000,000 from HQ for the above activities. This amount was

disbursed to each court station and activities were undertaken. Each

station has reconciled back with JTI. The balance of Kshs

1,249,000.00 is yet to be surrendered to headquarters from

JTI.(Annex Fin 13 Internal Audit report finding and closure / surrender

letter from JTI)

(f) Failed to ensure Monthly bank reconciliation statements.This is an audit query that was asked by internal auditor and answered to

their satisfaction as follows: Bank accounts and reconciliations were not

up to date at the point of internal audit of JTI. Due to capacity gaps, the

financial records were inadequately prepared and stored. An exercise to

bring the books into order and payment vouchers recovered and posted

was undertaken. All supporting documents were submitted to the internal

auditors. Bank reconciliations have been done up to 30th June 2012.

Additionally in 2013/14 a senior accountant has been posted to provide

support. (Annex Fin 14 JTI Bank Reconciliations)


45/73


Since the JSC-JTI has been given a separate vote (205) and IFMIS has been

installed for Vote 205, the process to close the JTI KCB Account is

underway upon completion and certification by the Internal Auditors.

(g) Payment to be made from JTI before being subjected to scrutinyby voucher examination

This is an audit query that was asked by internal auditor and answered to

their satisfaction as follows. The process in place was that JTI submitted

their vouchers after processing for examination. The staff capacity did not

allow for a full time examination team at JTI. This has since been addressed

in current FY2013/14 where JSC-JTI is a separate vote. An examiner with

adequate knowledge and experience has been posted to JSC-JTI.

(h) Failed to ensure AIEs issued during 2012/2013 financial yeardid not exceed approved estimates by 72,956,565

This is an audit query that was asked by internal auditor and answered to

their satisfaction. This has also since been addressed in current FY2013/14

where JSC-JTI is a separate vote. However, below is an extract of our

response to the auditor: The over issue was as a result of the cutting down of

the supplementary budget 1. The supplementary budget was cut after JTI had

received the 67million in addition to AIE for quarter I and II. Thereafter no

further AIE was sent to the JTI in quarter 4 to address the shortfall arising

from the budgetary cuts in supplementary one.

13.Audit Report 2012/2013


46/73


The Financial Statements for the current financial year were being

finalized. The PFM Act 2012, Section 81 (4) provides that the Financial

Statements are finalized not later than three months after the end of each

Financial Year effectively not later than 30th September.

The Financial Statements are to be submitted to the Auditor General, with

copies to the Controller of Budget, National Treasury and Commission on

Revenue Allocation. This was done within the statutory stipulated period.

We have already submitted our financial reports (Annex Fin 15Letter of

understanding with KENAO.)

B.ALLEGATIONS OF MISMANAGEMENT IN HUMAN RESOURCE14.ALLEGED IRREGULAR SECONDMENT OF STAFF

There has been no irregular secondment of staff. As a result of the expanded

mandate of the office of the Chief Justice and the newly created office of the

Chief Registrar in the Constitution of Kenya 2010, the Judicial service

Commission on 16th November 2011 approved a new structure that provides

additional Human resources capacity within the office of the Chief Justice, the

Deputy Chief Justice, the Office of the Chief Registrar, the President Court of

Appeal and the Principal Judge High Court. The rationale for this was that

these constitutional offices have wide ranging duties both judicial and

administrative which could not be sufficiently undertaken given the then

staffing arrangements.

Prior to the resolution of 16th November 2011, the Chief Registrar upon

reporting on duty in September 2011, requested for enhanced capacity in the


47/73


OCRJ as the previous office of the Registrar- High Court, could not cope with

the demands of the mandate of the newly created office and its accompanying

constitutional and legislative mandate.

As the Chief Registrar I sought authority and approval from the Head of the

Judiciary - the Chief Justice to second officers from other Government

institutions to the Judiciary to help bridge the capacity gap as per section 27D

(II) of the JSSR. In particular the Hon. Chief Justice as Head of the Judiciary

approved the secondment of Mr. Nicholas Okemwa, Ms. Anne Nyokabi

Nganga, Mr. MbuguaKabiroJoselynKathure and Mr. Michael Mayaka from

NCLR and IEBC. (Annex HRM 1 Letter approved by CJ

Secondment is a common practice in government especially in instances

where there is a need to fill a capacity gap or skill urgently.

In addition, I further requested for officers to be seconded to the Judiciary

from other institutions with the aim of enhancing capacity in the Judiciary as

the recruitment of Directors was underway. These other agencies included;Ministry of Finance, Directorate of Public Procurement, Public Service

Commission - Directorate of Personnel Management, Ministry of

Communication and Information, Ministry of Forestry, Ethics and

Anticorruption Commission, University of Nairobi and the Ministry of

Transport. (Annex HRM 2List of officers seconded to the Judiciary)

Further JSC in its meeting on 1st December 2012 adopted the report of the JSC

HR Subcommittee and resolved to absorb, those officers who were already

serving on secondment and had shown interest in remaining in the Judiciary

in accordance to rule 9 (2) of Third Schedule to the Judicial Service Act

.(Annex HRM 3 JSC resolution)


48/73


15.ALLEGATION OF PLACING STAFF ON IRREGULAR SALARY SCALESAND PAYMENT OF UNAUTHORIZED BENEFITS

There is no irregularity that has occurred. It is a practice in government that

officers who are on secondment move with their salary and benefits from

their previous employers as per the circular of the Public Service Commission.

The JSC has previously relied and used the same circular to approve the terms

and conditions of a judge of the Court of Appeal. Therefore there is no

irregularity in seconded staff moving with their salaries (Annex HRM 4-DPM

circular)

Further, The Judicial Service Commission HR Sub-committee in its meeting

held on 19th November 2012 was presented with the qualifications and job

description of the officers who were serving on secondment and temporary

appointment. The Sub-committee adopted the report and made

recommendations to the full JSC to adopt the same report. The report was

then implemented accordingly. Annex HRM 5 Minutes of 19th November 2012

and Annex HRM 6 Reportpresented to the JSC HRM Committee

16.Alleged irregular recruitment of students, interns, casuals andtemporary staff.

There has not been irregular recruitment of any staff. The Judiciary has in the

past and continues to provide students with practical experience that merges

theory and practice. The Judiciary has on occasion received letters from

various institutions of higher learning to provide their students with practical

work experience.


49/73


Use of students in judicial programs actually saves the public money while at

the same time developing and mentoring the youth. Therefore the Judiciary in

line Article 56 of the Constitution supports the student programs to ensure

that youth (a) access relevant education and training; (b) have opportunities

to associate, be represented and participate in political, social, economic and

other spheres of life (c) access employment.

Clinicals program for students - In order to provide students with a

practical experience that merges theory and legal practice, students who have

completed their second year at law school at the University level are expected

to undertake the clinical program at the law courts. The programs runs for a

period of two months and the students are expected to familiarize themselves

with court operations and thus will attend court and assist in the registries.

Pupillage/internship programs The Kenya School of Law has approved

the Judiciary providing from at least Resident Magistrate Level and above to

act as pupilage centers. The Legal Education Act vide Section 22(1)(c),

requires that For purposes of the award of a certificate or diploma in law, a

person shall undergo, in the case of a professional post graduate course at

least one year of instruction, and sit and pass all the examinations in the core

courses set out in the Second Schedule. The Pupilage program (six months

attachment) is one of the requisite programs set out in the Second Schedule of

the Act. Students in other disciplines are attached on the three months basis.All internship applications are processed through the Directorate of HR based

on availability of space and requests received from user departments. This

program has been highly successful despite interference and undermining of

the same by Commissioner Emily Ominde. Commissioner Ominde almost


50/73


derailed this program by instructing magistrates to prohibit the pupils from

carrying out any duties thereby creating confusion, time wasting and

temporary backlog of cases that were to be dealt with by the rolling out of this

program. I raised this issue with the Hon. Chief Justice who stepped in

and resolved the matter (Annex HRM 7 Letter to Emily Ominde by CJ).

Casual and temporary appointments - The JSSR Section D.18(i) of the

states that The Authorized Officer will be responsible for approving the hiring

of casual workers after ascertaining that there is need to hire them and that

funds are available within their budgetary provisions to meet the resultantexpenditure.

Further Section B.4 (i) states that the regulations governing the making of

temporary appointments are contained in the Judicial Service Commission

Regulations. Appointments on such terms may be made for a period not

exceeding one year without the authority of the Commission but may not be

continued for a longer period without such authority.

Therefore the request to hire casual staff and temporary staff is generated by

the user department and is based on a need or project based. Thereafter the

request is processed by the Directorate of Human Resource and Management

upon approval. (Annex HRM 8 Requests for casual staff). This is the process I

explained to Commissioner Justice Mohamed Warsame when he came to my

office demanding people hired as casuals. He did not take it kindly stating that

I should directly hire his people like the former Registar who hired 30

people for him. This is an issue I raised with the Hon. Chief Justice who told

the said Commissioner not to be coming to my office.


51/73


Such project undertaken with the help of casual staff include:

Typing of proceedings Data entry for the election petition case management system Statistics gathering Auditing of court cases at the registries Auditing and arranging finance documents.

It is noteworthy to point out that the hiring of casuals has been a bone of

contention between my office and the JSC. Despite the JSSR granting my office

powers to engage temporary staff and the Judicial Service Act appointing meas the authorized officer in charge of human resources, the JSC has resolved to

be the one to hire even a cleaner for a single day. (Annex HRM 9JSC Human

Resource Committee of 26th February 2013).

17.ALLEGED FAILURE/ NEGLECT TO DEVELOP A HUMAN RESOURCEWORK PLAN.

The Judicial Service Commission has never requested my office to provide

them with a human resource work plan and therefore the accusation of failure

and neglect to develop a human resources work plan does not arise.

However I wish to state as follows:

I. That the Judiciary with the support from GIZ engaged the services of aconsultant in Oct 2012 to conduct a Comprehensive Human Resource

Inventory. The consultant developed an online gathering tool in

collaboration with our ICT Directorate for staff to fill in their details

(skill, experience and qualifications date of employment). (Annex HRM

10 Data entry form)


52/73


II. That on completion of the online system, I sent out two a memos dated9th and 11th November 2012 requesting staff to fill in the online forms.

(Annex HRM 11 Memo Requesting Staff to fill form online)

III. That the consultant completed the 1st phase of the exercise andsubmitted a preliminary report in March 2013 and made

recommendations for the Judiciary to conduct a certificate verification

exercise. The provisions of the said services were advertised (Annex

HRM 12Advert -Certificate verification exercise)

IV. That the Judiciary undertook a biometric registration of all judicialofficers and judicial staff(Annex HRM 13CD biometric exercise).

18.ALLEGED DISCRIMINATORY PRACTICES AGAINST STAFFI have never practiced any discrimination against any staff member. First and

foremost I wish to clarify that Ms. Anne Nganga, who sits in my office is NOT

a secretary and is not qualified to be one. She holds the position of Chief

Administrator office of the Chief Registrar of the Judiciary and has previously

held the Positions of Publishing and Administrative Officer at the National

Council for Law Reporting (NCLR) and Regional Liaison Coordinator at the

Interim Independent Electoral Commission. Mr. Nicholas Okemwa is an

advocate of the High Court of Kenya and holds the position of Legal Counsel

Office of the Chief Registrar of the Judiciary and was the Head of the Research

and Development Department at NCLR. Thus these officers constitute part ofsenior management as their positions are at deputy director level.

The issuance of cars to judicial staff is at the discretion of the Accounting

officer, but the decision is based on the nature of the job of the assigned


53/73


officer, and the need for th

response to queries raised by the jsc 15th oct 2013b

Documents