Court suspends auction of KPCU prime property

The Kenya Planters Co-operative Union has secured a reprieve after a court temporarily suspended the sale of its assets over a loan of Sh644 million.

A public auction of the union’s prime buildings in Nairobi scheduled for Friday was put off by Commercial Court judge Leonard Njagi.

He allowed an application by KPCU to stay the sale pending a further mention of the dispute on September 7.

Mr Justice Njagi said the case had a long legal history and that his counterpart Mr Justice Muga Apondi was well placed to arbitrate on the dispute.

The High Court is currently on vacation and judges are expected to resume duty later in September.

Mr Justice Njagi is the duty judge at the Commercial Court.

Thursday's ruling was hailed by the farmers after an earlier application to stop the sale was dismissed by the Constitutional Court for lack of merit.

Lady Justice Roselyn Wendoh had on Tuesday declined to block the sale, arguing that KPCU had failed to pay loan arrears owed to KCB.

She said the agreement between KCB and KPCU was a private commercial contract and the only recourse for the association was to pay the money advanced by the bank.

Recover debt

“There are no valid reasons to stop KCB from exercising its statutory rights to recover its debt through auction,” ruled Lady Justice Wendoh

She refused to stop the sale and dismissed the miller’s application for judicial review as an abuse of court process.

But KPCU lawyer Gichuki King’ara accused the judge of bias and sought that the matter be moved out of her jurisdiction.

Lady Justice Wendoh, however, stood her ground but referred the dispute to the Chief Justice for further directions.

The farmers’ union claims there were fictitious and erroneous entries in its account held at KCB amounting to over Sh250 million.