Former Rangwe MP loses Lavington house to auction over Sh7m debt

Former Rangwe MP Philip Okundi.

Photo credit: File | Nation Media Group

A company associated with former Rangwe MP Philip Okundi has failed to reverse the auction of his house in the Lavington area after the High Court ruled that he was to blame for failing to deposit Sh7 million on time, as had been directed.

High Court judge Alfred Mabeya ruled that the only remedy available for Mr Okundi through Asego Holdings Limited, was to sue Mayfair Bank for damages as the court cannot reverse an auction that has already taken place.

According to the judge, Asego Holdings Limited did not deposit the money by close of business on October 23, 2023 as had been ordered by the court.

Evidence tabled in court showed that the bulk of the money was deposited the following day, on October 24, 2023.

“In any event, no injunction can be issued stopping the auction as the same has already taken place and thus, the plaintiff’s (Asego Holdings) prayer for an injunction restraining the defendants from auctioning the suit property has now been overtaken by events. As such, the orders sought by the plaintiff cannot be granted,” said the judge.

Mr Okundi moved to court seeking to permanently stop the lender and Legacy Auctioneers from selling or disposing off the house on Thompson Estate, in Lavington, which had been charged to the bank to secure financial facilities granted to Edward Kenneth Otieno Okundi.

When the matter came before the judge on October 19, 2023, the court stopped the planned auction on condition that the company paid Sh7 million by close of business on October 23. Mr Okundi said he complied with the court’s order by making payments through RTGS of Sh6.75 million and M-Pesa of Sh250,000.

He said he informed the bank’s advocates of the payment and provided the evidence of the deposits.

However, the former MP said the bank proceeded and sold the house, in defiance of the court order.

The bank through Ms Lynette Kamande opposed the application and stated that Mr Okundi paid the money through M-Pesa of Sh250,000 on October 23, 2023 and RTGS the following day.

She said as at 11 am on October 24, the RTGS was yet to be confirmed and as such, the auction proceeded in compliance with the order.

The judge said it was incumbent upon him to ensure that the payments were to be received by the bank before close of business on October 23.

Whereas the court agreed with Mr Okundi that the court did not provide for the mode of payment or that the payment be by way of cleared funds.

"From the annexures produced, it is evident that the RTGS payment which was initiated by the plaintiff on 23/10/2023 was actually received by the Bank on 24/10/2023,” said the judge.

The judge said the company cannot claim to have made the payment within the timelines set out by the court.

Justice Mabeya said since the property had been sold to a third party, the only remedy available to the Asego Holdings, if not satisfied with the sale, would be to seek damages as provided for in section 99 of the Land Act.

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