A court has cleared National Bank of Kenya (NBK) to auction the Nairobi Upper Hill Hotel, rejecting a plea to block the sale.
The lender last year notified the hotel owner Geoffrey Wahome Muotia of its plans to auction the hotel over a Sh447 million debt.
Mr Wahome, however, wanted the sale stopped pending the determination of his application.
Environment and Land Court judge Jacqueline Mogeni nonetheless dismissed Mr Wahome’s plea stating that the court has no powers to determine the case that should have been filed before the High Court.
“Given the foregoing, I find that this Court based on the reliefs sought, and a red flag having been raised the earliest, that this Court lacks jurisdiction to proceed further to consider the claim as raised in the plaint and, in the same breath deal with the pending application for an injunction, I down tools,” Justice Mogeni said.
Mr Wahome has been fighting to block the sale over the years and the matter has been heard up to the Court of Appeal.
Justice Mogeni noted that Mr Wahome has filed four other applications where the High Court has pronounced itself on the matter.
The judge said it was not disputed that the property was charged to the bank to secure an overdraft, commercial mortgage, and a term loan.
She added that the owner has long defaulted in the repayment of the loan forcing the bank to issue the statutory notice of sale.
“We are primarily dealing with a legal charge here and the subsequent statutory notice of sale, which is what the applicant intends to stop and which cannot be separated from the applicant’s intended action for redevelopment of the suit property,” the judge said.
According to the judge, this can only be challenged in the High Court by opposing the sale as Mr Wahome alleged that the lender has failed to give a chance for a proposal of the repayment through redevelopment.
Evidence presented in court showed that Mr Wahome was granted an overdraft of Sh10 million, a commercial mortgage of Sh236 million, and a term loan of Sh35 million totaling Sh281 million exclusive of interest and bank charges, in September 2014.
However, 10 years on, he allegedly defaulted leading to an outstanding balance of Sh447 million.
Mr Wahome had previously accused the lender of frustrating his efforts of the loan being taken over by another lender by referring him to Credit Reference Bureaus (CRB) thereby ‘clogging his right to redeem his property’.
