Supreme Court Sets Aside KSh103.4 Million Award in NSSF CCTV Tender Dispute

On Friday, October 30, 2026, a five-judge bench headed by Chief Justice Martha Koome delivered a judgment that nullified a KSh103.4 million compensation award to a private contractor in a dispute with the National Social Security Fund (NSSF).

The award stemmed from a KSh244.8 million contract awarded in March 2011 for the installation of CCTV cameras and access-control systems at Social Security House in Nairobi, with a signed agreement following in April and an annual maintenance fee of KSh15 million after a two-year warranty.

The project never began because NSSF did not hand over the site, and in May 2012 the Fund notified the contractor that it could not proceed owing to budgetary limits, prompting the company to sue for breach of contract.

The High Court in April 2020 granted the contractor KSh16.06 million but dismissed its claim for KSh103.4 million in anticipated profits as speculative, a decision that the Court of Appeal overturned in April 2024 by awarding KSh112.5 million in special damages, including the disputed profit figure and KSh9.06 million in other costs.

In overturning the appellate award, the Supreme Court highlighted major discrepancies in the contractor’s financial evidence, noting that the managing director had projected expected profits of about KSh26 million, whereas an accountant’s report claimed KSh103.4 million without reconciling the gap.

The judges also questioned the accountant’s reliance on unverified data and the projection of five years of maintenance income despite the absence of any guarantee from NSSF that such work would be provided, and they pointed out that the contract permitted termination by NSSF with one month’s written notice.

“The material before the Court did not provide a sufficiently reliable factual foundation for the specific award of KSh103,447,136,” the bench said, adding that NSSF’s failure to present a competing expert report did not cure the deficiencies in the contractor’s claim.

The Supreme Court therefore set aside the KSh103.4 million award and clarified that claimants seeking compensation for lost profits must furnish credible evidence showing that the profits were likely to have been earned.