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Nakuru baker sues Gor Mahia over bread deal

Nakuru-based baker Good Bread Limited has sued Gor Mahia Football Club over cancellation of a lucrative five-year contract for the manufacture of bread branded with the team’s logo and name.

Good Bread says in court papers that the contract with Gor Mahia provided for a one-month notice if either party wanted to pull out of the deal. The baker holds that Gor breached the contract and should be compelled to reinstate the deal.

Gor Mahia ditched Good Bread in August for rival baker Uzuri Foods, which trades as Elliots, which is also enjoined in the suit. The Nakuru baker says it discovered it had been ditched through media reports.

Justice Erick Ogola has ordered the Kenyan Premier League champions to temporarily furnish Good Bread with the right to manufacture and sell Gor Mahia-branded bread, until the suit is heard and determined.

“On August 27 I saw an advertisement stating that Gor had entered into a similar agreement with Elliots… The following day I received a registered mail from Gor indicating that it had terminated the contract,” Good Bread says.

PRICE OF BREAD

Gor Mahia has hit back at the Nakuru baker, saying Good Bread breached the contract by hiking the price of the bread to Sh38 instead of the agreed Sh37 shelf price. The club’s chairman Ambrose Rachier says Good Bread did not adjust the rights fee payable to his club after hiking the cost of Gor bread.

Mr Rachier adds that Good Bread in April remitted rights fees to Gor later than agreed, and in May paid the same early hence denying his club three days’ revenue.

Gor Mahia has also faulted Good Bread’s capacity as it says the baker has only managed to produce half the amount of bread agreed on. Good Bread was expected to produce a minimum of 100,000 loaves of bread each day, which was to translate into Sh3 million monthly revenue for the club.

“Between the date of execution of the contract and the date of its termination, Good Bread has remitted to Gor a paltry Sh1.4 million translating to a purported sale of 209,500 loaves a month.

“Gor believes that Good Bread either has no capacity to produce the quantity of bread that makes it economical for Gor to in the contract, or it is wilfully and fraudulently concealing its monthly production hence its refusal to furnish Gor with its weekly sales,” Mr Rachier says.

Elliots says it was approached by the football club to manufacture the bread and that it was not privy to Good Bread’s contract.

Source: Business Daily