The embattled real estate company, DN International (DNI), is back in the news, for all the wrong reasons.
The embattled real estate company, DN International (DNI), is back in the news, for all the wrong reasons.The company is yet to settle an outstanding case with Fina Bank and the people who bought units at its Hill View estate, yet it finds itself amidst a new dilemma.Companies and individuals who supplied construction materials to debt-ridden DN International are crying foul as hopes of getting paid grow dimmer.DNI’s troubles began when Fina Bank moved to auction houses the company had sold to individual buyers at the Hill View Estate in Gasabo District.And now matters seem destined for the worse, with suppliers demanding payment for the materials the company used in the construction of other estate, Green Park Villas (GPV). They want the authorities to intervene.A group of 96 construction material suppliers, including companies, individuals and casual labourers claim DNI owes them over Rwf372 million. They say officials at the Council of Kigali City and Gasabo District have made it clear to them they have nothing to do with their case."When we started complaining to DNI requesting for our payment, the Managing Director, Joseph Kapukha, told us that he had an agreement with the Kenya Commercial Bank (KCB) as a partner and that KCB was to take care of the payments."We went to KCB and met with the Head of Corporate Affairs, Ojoo Ajulu, who then promised that we would have our money on our accounts by November 31, 2011,” said an aggrieved Francis Bayingana who spoke on behalf of the suppliers.In a letter from Kapukha to KCB, he requested the bank to hold, as security for the loan, three houses at the GPV estates. According to Bayingana, when the suppliers went to KCB on November 31, 2011, Ajulu said that KCB wasn’t working with DNI anymore and wouldn’t give them any money. Efforts to contact Ajulu were fruitless but the Managing Director of KCB, Maurice Toroitich, told The New Times that the bank wasn’t aware of any arrangement with DNI. "Instead DNI owes us money because we fully funded the construction of GPV under the mortgage arrangement…frankly I am not aware of any arrangement for us to pay the debts of our client,” said Toroitich. Instead, he said that the bank is currently also struggling to recover its money from the troubled company.After failing to recover their monies from KCB, the suppliers resorted to seeking assistance from local and central government authorities."We petitioned Gasabo District but it was all in vain. On the first attempt, the Mayor, Willy Ndizeye, told us to write to him. We did exactly that and then copied it to the Council of Kigali City, the Ombudsman, the Ministry of Local Government, the Police and RDB,” said Bayingana.The letter to the Mayor of Gasabo was dated December 09, 2011. Bayingana said that the mayor wrote to the Council of Kigali City on January 12, 2012, seeking advice on how to handle the case. However, the letter to the Council of Kigali City, from Gasabo, signed by Aline Niwemukobwa, who is in charge of good governance, said that only 19 suppliers were owed a total of Rwf175.3 million, explaining that they are the only ones with proper contracts. "This was wrong. DNI knows clearly how much it owes its suppliers and how many they are. Some of these people are casual labourers with no contracts but that doesn’t mean they shouldn’t be paid,” said Bayingana. A debtors’ list The New Times obtained shows that Marie Rose/Better Hardwares, who claims Rwf 25.9m, is owed the most amount while Obed, a subcontractor, is demanding Rwf 21,500. Efforts to reach the mayor of Gasabo were fruitless, but the Mayor of Kigali City, Fidele Ndayisaba, said that the case had not reached his office. "Even if it had, I would have advised them to seek legal redress. City Council does not have the power to force DNI to pay its suppliers,” said Ndayisaba, adding that his office is willing to offer as much assistance as it can. The New Times is in possession of the letter to KCC.The suppliers filed their concerns at the Remera police station two months ago, expecting the case to be forwarded to the courts but the file is still pending, they say. They also claim they have had no assistance from RDB. When contacted, the RDB Chief Operating Officer, Clare Akamanzi, said that RDB is unaware of the suppliers’ case, but added there’s little her office can do. "If one of the parties breached the contract, then the other should go to court,” she said. It also emerged that some of the suppliers had acquired bank loans to supply DN International. After they were unable to pay back their debts, the banks confiscated and auctioned their property. For stance, Alphonse Habimana, a sand supplier, had his truck attached after he failed to repay a Rwf1.5m loan. Late last year, DNI was embroiled in controversy when nineteen people who bought units at its Hill View Estate, on the outskirts of Kigali, at the cost of Rwf 55 million each, almost lost their homes because the developer breached a contract with its financer - Fina Bank. DN accumulated debts close to Rwf1 billion in order to construct the Hill View Estates, but have only repaid less than Rwf600 million, with outstanding debt totalling Rwf450 million. Fina Bank threatened to auction the houses in order to recover its money. But RDB intervened to ensure none of the parties incurred losses in the process. Asked about the progress, Akamanzi said that RDB was still trying to resolve the issue. "We are looking for solutions to this problem but are making progress, I can’t comment more until we get a genuine solution,” said Akamanzi. Efforts to contact DNI officials were fruitless as all their known mobile phones were switched off.