NBK gets nod to auction UpperHill hotel in Sh281m loan row
The High Court has granted the National Bank of Kenya (NBK) the nod to auction the Nairobi UpperHill Hotel after dismissing a fresh attempt to stop the forced sale in a long-running court battle with hotelier Geoffrey Wahome Muotia.
Justice David Majanja dismissed the application by the hotel, seeking to halt the sale to be conducted by Keysian Auctioneers.
Read: Nairobi UpperHill Hotel put on auction over NBK loan
The judge noted in the ruling that the fresh attempt was made by the hotel itself after he dismissed an earlier application by Mr Muotia, seeking to stop the bank from selling the property over an alleged loan of Sh281 million he borrowed in 2014.
Justice Majanja said he had already dealt with the issues raised leading up to the sale of the property and stated that the lender was entitled to exercise its statutory power of sale and dismissed 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-storey property in the local dailies, inviting potential buyers for the hotel, which is located in the prime Upper Hill area.
Mr Muotia had initially secured a Sh281 million loan against the property in 2014, which was guaranteed by the property.
The lender accused him of defaulting on the loan repayment, forcing NBK to engage auctioneers to recover the money but the hotelier blamed the poor structuring of financing systems for the challenges local hoteliers have experienced in repaying their loans.
Mr Muotia further said his attempts to have the loan taken over by another bank were frustrated by NBK after the lender referred him to Credit Reference Bureaus (CRB) thereby ‘clogging his right to redeem his property’.
Read: Owners of Upper Hill's 45-floor tower risk forfeiting land
The hotelier first moved to court in 2015 and obtained orders stopping the lender from auctioning the property. BY BUSINESS DAILY
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