National Bank of Kenya has been barred from selling five parcels of land used as collateral to secure a Sh3.6 billion loan by a company owned by the late Mombasa tycoon Tahir Sheikh Said.
The bank auctioneers had on February 16 this year issued a Notice of Sale to sell the properties to secure the money plus Sh12 million with interest and other charges.
The High Court has extended orders temporarily restraining the National Bank of Kenya #ticker:NBK from interfering with possession or advertising for sale five parcels of land used as collateral to secure a Sh3.6 billion ($36.1 million) loan by a company owned by the late Mombasa tycoon Tahir Sheikh Said.
Justice Patrick Otieno extended the orders granted to Juja Coffee Exporters Ltd, which has sued the bank seeking among others an order that notification of sale dated February 16 by the bank to the company be set aside.
Mr Said, a wealthy businessman and political broker in the Coast region, died last year leaving behind heavily indebted businesses.
The tycoon was more commonly known as TSS.
Through lawyer Paul Munyao, the bank wanted the court to extend the orders on condition that the company deposit Sh100 million.
Mr Munyao argued that Juja Coffee Exporters Ltd are not disputing the debt hence the need for the interim orders to be extended on condition. Juja Coffee Exporters Ltd objected to the condition being placed on the extension of the orders saying it will be prejudiced.
Justice Otieno declined to order a conditional extension of the orders saying he would not interfere with the orders earlier issued before hearing the parties.
The company wants a temporary injunction issued pending hearing and determination of the application restraining the bank from interfering with its possession, marketing, advertising for sale, leasing, subdividing, receiving or taking possession of the charged parcels of land to secure US dollars 36,095,495.41 (Sh4 billion) as outstanding amounts.
The application is based on the grounds that the company is the owner of the five properties which were charged to the bank as collateral to secure a principal loan.
“A director with a major stake in the plaintiff (company) has since passed on and the surviving directors are willing to come to a structured settlement on repayment plan,” the application read in part.
According to the company, the bank auctioneers had on February 16 this year issued a Notice of Sale to sell the properties to secure the money plus Sh12 million with interest and other charges.
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