The National Bank of Kenya (NBK) has been given permission to auction the Nairobi UpperHill Hotel after dismissing a new attempt to stop the forced sale in a long-running court battle with hotelier Geoffrey Wahome Muotia.
Justice David Majanja denied the hotel’s application to halt the sale, which was to be conducted by Keysian Auctioneers.
The judge noted in his ruling that the hotel made the new attempt after dismissing an earlier application by Mr Muotia seeking to halt the bank from selling the property over an alleged loan of Sh281 million he borrowed in 2014.
Justice Majanja stated that he had already addressed the issues raised prior to the property’s sale and that the lender was entitled to exercise its statutory power of sale, dismissing Mr Muotia’s application.
“I agree with counsel for the bank that the plaintiff (UpperHill hotel) does not have any standing to agitate this suit in respect of a property in which it lacks a proprietary interest,” the judge said.
The auctioneer will now proceed and advertise the sale of the four-story property in the local dailies, inviting potential buyers for the hotel, which is located in the prime Upper Hill area.
Mr Muotia had originally secured a Sh281 million loan against the property in 2014, which was guaranteed by the property.
The lender accused him of failing to repay the loan, forcing NBK to use auctioneers to recoup the funds, but the hotelier blamed the difficulties local hoteliers have had in repaying their loans on poor financing system design.
Mr Muotia also claimed that his attempts to have the loan taken over by another bank were thwarted by NBK after the lender referred him to Credit Reference Bureaus (CRB), ‘clogging his right to redeem his property’.
The hotelier first went to court in 2015 and obtained an injunction preventing the lender from auctioning off the property.
