Corporate News
Collapsed Dubai Bank chairman Hassan Zubeid. PHOTO | PAUL WAWERU
In Summary
- Thika Muslim Housing Co-operative Society seeks to stop Zubeidi from auctioning its 40-acre land to recover a Sh50 million debt.
The owner and chairman of the collapsed Dubai Bank
Hassan Zubeidi is entangled in a land tussle with a Thika-based housing
society.
Thika Muslim Housing Co-operative Society wants the High
Court to stop Mr Zubeidi from auctioning its 40-acre land to recover a
Sh50 million debt, which it denies owning him. It has also accused Mr
Zubeidi of relying on irregularly obtained court orders to auction its
land.
Mr Zubeidi sued the Thika society in 2004 claiming
it had refused to repay a Sh14.6 million loan he advanced to it in 1999,
despite having sent a demand and intention to sue notice.
He now wants Sh50 million-- which he says is the
present value of the loan having accrued interest at an annual rate of
30 per cent as per the loan agreement.
The Thika group is challenging Justice Fred
Ochieng’s decision that allowed Mr Zubeidi to auction the land,
insisting that the chairman of the collapsed bank tricked the judge into
issuing the orders.
The housing society says Mr Zubeidi did not furnish
it with the court summons for the hearing that saw Justice Ochieng
allow the auction.
“Mr Zubeidi has irregularly obtained orders against
Thika Muslim Housing Co-operative Society and is now in the process of
transferring the land to a third party. There is an affidavit by one
Joel Velela in which he alleges that he made three visits to our offices
but found them closed.
“The notice to show cause was heard on the strength
of the affidavit and ruling delivered on the same day. In the absence
of proper service, the orders issued by this court can be set aside,”
the mortgager’s chairman Abdallah Ndope says.
Mr Zubeidi says in suit papers that Thika Muslim
Housing Co-operative Society approached him to finance a borehole
drilling project on its land.
He insists that he gave the housing society Sh2.5 million in cash and paid the balance to contractors handling the project.
Justice Muga Apondi in 2011 ruled in favour of Mr
Zubeidi, but stopped the auction after Thika Muslim Housing Co-operative
Society filed a notice of appeal.
The Court of Appeal in February this year struck
out Thika Housing’s notice of appeal arguing that it had taken too long
to file its appeal papers.
Justice Fred Ochieng in June this year also allowed
the auction after the housing society failed to file its actual appeal.
Mr Ndope now says the appeal was delayed by internal leadership
wrangles that have stalled the group’s daily operations.
The Thika-based cooperative says it has over 750
members who stand to lose millions of shillings if Mr Zubeidi is allowed
to complete sale of the land.
But Mr Zubeidi insists that he followed due process
in auctioning the land, and that the mortgager is trying to misuse the
court process to obstruct justice. Justice Ochieng ordered the parties
to appear before him on September 21.
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