A Gulf African Bank branch on Kenyatta Avenue, Nairobi. The bank has
been allowed to auction a businesswoman’s property after she defaulted
on a Sh110 million loan. FILE PHOTO | NMG
A businesswoman has lost the legal fight to save her mortgaged property valued at Sh100 million from the auctioneer's hammer.
High
Court judge Christine Meoli allowed the Gulf African Bank to auction
the land and buildings in Thika, Kiambu County to recover more than
Sh110 million advanced to Mrs Hannah Wairimu Mutura in April 2014.
The
judge said Mrs Mutura’s acts and omissions together with her persistent
default and dishonouring of accommodations made by the bank,
disentitled her from equitable relief.
“He who comes to
equity must come with clean hands,” ruled the judge, as she declined to
exercise her discretion to allow Mrs Mutura more time to settle the
bank’s loan and accrued interest. The judge said the two key factors
which militated against the exercise of discretion in Mrs Mutura favour
was, firstly, her admission of habitual default in her various
correspondences with the bank and in her replying affidavit.
Secondly,
justice Meoli said Mrs Mutura filed the present suit on June 18, 2018
and proceeded to lodge yet another case in the Commercial and Admiralty
Division at the High Court in Nairobi and concealed the information from
the court.”
The judged noted the defaulter was
admittedly in arrears and her replying affidavit chronicled the history
of non-payment since 2015, barely one year after the commencement of the
financing arrangement between her and the bank.
Mr
Mutura obtained a loan from Gulf African Bank of Sh110 million in 2014
to finance the purchase of a prime property in Thika town. The loan was
secured in part by a legal charge over the property and a further charge
of another property valued at Sh10 million and a personal guarantee of
her husband Mr David Njuguna Ngoi.
According to the
court’s ruling, Mrs Mutura made several repayments at the initial stages
but did not continue for long. The bank said as in April 2018, she was
in arrears of Sh23.6 million. The bank, having previously served her
with the statutory notice, instructed Garam Investment Auctioneers to
proceed and sell the property by public auction on June 19, 2018.
But
on June 18, 2018, a day before the intended auction, Mrs Mutura moved
to court for a temporary injunction stopping the bank from carrying out
the sale until her application was heard and determined.
She
pleaded with the court to be allowed to liquidate the loan through
monthly instalments of Sh1.5 million for the first 12 months and
thereafter Sh200,000 monthly instalments until the entire loan amount
was fully paid.
Mrs Mutura also sought to be given
adequate time within which to sell the property by private treaty and
use the proceeds to pay the entire debt.
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