[2018] KEHC 6035 (KLR)
The court found that the Treasury Bonds held under lien by the interested party (Standard Chartered Bank Ltd) should be sold at the best prevailing market rate to satisfy the defendant's (Tsavo Securities Ltd) indebtedness to the interested party. Any surplus realized from the sale, after settling the interested...
Source-derived case information.
- Citation
- [2018] KEHC 6035 (KLR)
- Parties
- Plaintiff: Central Bank of Kenya; Defendant: Tsavo Securities Ltd; Respondent: Standard Chartered Bank Ltd
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Commercial Courts)
- Jurisdiction
- Kenya
- Case Number
- Civil Case 267 of 2014
- Procedural Posture
- Miscellaneous Application / Ruling on Notice of Motion for Review And/or Variation of Orders
- Outcome
- Application for review and/or variation of orders deferred pending parties' appearance for resolution of quantum.
- Judges
- F Tuiyott
- Legal Topics
- Lien on Treasury Bonds, Debt Recovery, Priority of Creditors
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Central Bank of Kenya
Plaintiff
Tsavo Securities Ltd
Defendant
Standard Chartered Bank Ltd
Respondent
Procedural Posture
Miscellaneous Application / Ruling on Notice of Motion for Review And/or Variation of Orders
Legal Issues
- 1 Whether the court should review or vary its previous orders to allow the disposal of Treasury Bonds held under lien to satisfy the defendant's indebtedness to the interested party.
- 2 How the proceeds from the sale of Treasury Bonds should be applied between the interested party and the plaintiff.
- 3 What is the correct amount to be recovered by the interested party from the sale of the Treasury Bonds.
Ratio Decidendi
The court found that the Treasury Bonds held under lien by the interested party (Standard Chartered Bank Ltd) should be sold at the best prevailing market rate to satisfy the defendant's (Tsavo Securities Ltd) indebtedness to the interested party. Any surplus realized from the sale, after settling the interested party's debt, should be credited to the plaintiff (Central Bank of Kenya) in respect of its debt. The only unresolved issue is the exact amount to be recovered by the interested party, with the plaintiff asserting a specific figure and the interested party seeking full settlement without specifying the amount. The court directed the parties to appear before it with substantive...
Court Disposition
Application for review and/or variation of orders deferred pending parties' appearance for resolution of quantum.
Orders
- Counsel for the parties to appear before the court on a date to be appointed to address the outstanding issue of the amount to be recovered by the interested party.
- The court will attempt to facilitate an agreement between the parties on the quantum to be recovered from the sale of Treasury Bonds.
Full Case Text
Judgment text and source record
30 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA
AT NAIROBI
COMMERCIAL & ADMDIRALTY DIVISION
HCC. NO. 267 OF 2014
CONSOLIDATED WITH CIVIL SUIT NO. 408 OF 2014 &
HC MISC. APPLICATION 299 OF 2015
CENTRAL BANK OF KENYA.........................................PLAINTIFF
VERSUS
TSAVO SECURITIES LTD..........................................DEFENDANT
AND
STANDARD CHARTERED BANK LTD....INTERESTED PARTY
RULING
1. The Notice of Motion dated 1st March 2017 need not be controversial. It seeks the following prayers:-
1. THAT this Honourable Court be pleased to review and/or vary the orders of this Honourable Court made on 1st July 2014 to allow the Defendant to execute the requisite documentation required to enable disposal of Treasury Bonds in the name of the Defendant to satisfy its indebtedness to the Interested Party and in default the Deputy Registrar of this Honourable Court to do so.
2. THAT this Honourable Court be pleased to review and/or vary the orders of this Honourable Court made on 1st July, 2014 to allow the Interested Party/applicant to sell, transfer and/or dispose Treasury Bonds in the name of the Defendant to offset its loan balance and cost owing to the Interested Party.
3. THAT in the alternative this Court be pleased to grant such other or further orders as it may deem fit and just in the circumstances of this case.
4. THAT the costs of this Application be provided for.
2. The Defendant does not oppose the Application, while the Plaintiff’s opposition is partial and limited.
3. Some Treasury Bonds belonging to the Defendant are held under lien by the Interested Party in respect to its indebtedness therein. At the same time the Defendant is indebted to the Plaintiff. It is common ground between all parties herein that the Bonds under lien ought to be sold by the Interested Party at the best prevailing market rate. It is anticipated that the amount to be realized at that sale shall be sufficient to pay the entire debt of the Defendant to the interested Party. Any surplus would in the first instance be to the credit of the Plaintiff in respect of its debt.
4. The only sticky issue is the amount to be recovered by the Interested Party. The Plaintiff asserts that this is Khs.47,424,806. 94 while the Interested Party’s position is that its debt should be settled fully but does not give the extent of that indebtedness. This really is the only outstanding issue and I have to take a view that a pragmatic approach is to first attempt an amicable resolution from the parties.
5. I direct that Counsel for the parties appear before me on a date I shall shortly appoint with substantive instructions on this narrow question. I shall in that session attempt to have the parties agree.
Dated, delivered and signed in open Court at Nairobi this 21st day of June 2018.
F. TUIYOTT
JUDGE
In the presence of;
Muchiri for Defendant
N/A for Interested party
N/A for Kithi
Nixon-Court Assistant