The High Court has temporarily stopped the Co-operative Bank of Kenya from auctioning or selling a parcel of land in the upmarket Nyali in Mombasa over a Sh155 million claim.
The plaintiff argues the financial facility was secured by a charge dated March 18, 2013, for Sh40 million and a further charge dated November 8 of the same year for Sh11.2 million that were registered in favour of the bank.
Mr Mturi says Co-op Bank, in exercise of its statutory right of sale, advertised the land for sale by public auction.
The High Court has temporarily stopped the Co-operative Bank of Kenya #ticker:COOP from auctioning or selling a parcel of land in the upmarket Nyali in Mombasa over a Sh155 million claim.
Justice Olga Sewe issued the order following an application by Jonathan Mturi, the proprietor of the land who is challenging the claim by the bank.
According to Mr Mturi, he is the registered owner of the land measuring approximately 0.9 acres and a guarantor of a bank overdraft of Sh51.2 million advanced by the bank to Quantum Petroleum Ltd in 2013.
Mr Mturi is seeking a declaration that the claim of Sh155 million against him is an illegality as it comprises not only the bank overdraft that was secured by two charges against his title on the land but also liabilities of Quantum Petroleum Ltd to the bank which he is not party to.
The plaintiff argues the financial facility was secured by a charge dated March 18, 2013, for Sh40 million and a further charge dated November 8 of the same year for Sh11.2 million that were registered in favour of the bank.
Mr Mturi says Co-op Bank, in exercise of its statutory right of sale, advertised the land for sale by public auction.
He argues that whereas the two charges were only meant to secure the overdraft of Sh51.2 million, it was apparent that Sh147 million indicated in a letter and Sh155.5 million which was indicated in the statutory notice was a consolidation of the money the petroleum company owes the bank.
“The plaintiff maintains that at no time did he consent and agree or charge the land to secure all the liabilities of Quantum Petroleum Ltd as alleged in a letter dated April 5,” part of the suit documents state.
Mr Mturi argues the proposed sale of the land by auction remains an illegality and void from the start.
According to the plaintiff, he is neither a shareholder nor a director of Quantum Petroleum Ltd and his only involvement with the dealings between the bank and the company was being a guarantor for the Sh51.2 million loan.
