[2008] KEHC 3041 (KLR)
The court found that, although the general principle is that a bank with a charge should not be restrained from exercising its statutory power of sale due to a dispute over accounts, the amount demanded in this case was excessively disproportionate to the amount originally borrowed and was not sufficiently...
Source-derived case information.
- Citation
- [2008] KEHC 3041 (KLR)
- Parties
- Plaintiff: Kudjeta Wamugo Njigoru; Defendant: Consolidated Bank Limited; Defendant: Watts Enterprises
- Court
- High Court
- Court Station
- High Court at Embu
- Jurisdiction
- Kenya
- Case Number
- ? 89 of 2007
- Procedural Posture
- Civil Case / Interlocutory Application for Injunction
- Outcome
- application allowed
- Legal Topics
- Injunctive Relief, Right of Charge, Family Property Protection, Disputed Bank Debt
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Kudjeta Wamugo Njigoru
Plaintiff
Consolidated Bank Limited
Defendant
Watts Enterprises
Defendant
Procedural Posture
Civil Case / Interlocutory Application for Injunction
Legal Issues
- 1 Whether the defendants should be restrained from selling the plaintiff's land by public auction pending determination of the suit.
- 2 Whether the amount demanded by the bank is excessive and unjustified.
- 3 Whether the court should interfere with the bank's statutory power of sale due to the circumstances.
Ratio Decidendi
The court found that, although the general principle is that a bank with a charge should not be restrained from exercising its statutory power of sale due to a dispute over accounts, the amount demanded in this case was excessively disproportionate to the amount originally borrowed and was not sufficiently substantiated by the bank. Given the lack of evidence supporting the bank's claim and the fact that the property in question is family land, the court determined that it was appropriate to grant an injunction restraining the sale pending the hearing and determination of the suit, in order to prevent potential irreparable harm to the applicant.
Court Disposition
application allowed
Orders
- The defendants are restrained from selling by public auction the applicant's pieces of land Ngandori/Kirigi/2646 and 2665 pending hearing and determination of this suit.
- Costs in the cause.
Full Case Text
Judgment text and source record
22 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA AT EMBU
Ciivil Case 89 of 2007
KUDJETA WAMUGO NJIGORU…………....………………PLAINTIFF
VERSUS
CONSOLIDATED BANK LIMITED…………....…….1ST DEFENDANT
WATTS ENTERPRISES……………………………..2ND DEFENDANT
RULING
Application dated 12th day of July, 2007 seeks orders to restrain the defendants from selling by public auction the Applicant’s pieces of land namely Ngandori/Kirigi/2646 and 2665 pending hearing and determination of this suit on the grounds that the amount now demanded Shs.14, 414, 110. 45 is illegally demanded and that the Applicant will suffer irreparable damage if the family land is sold in unjust circumstances. The supporting affidavit shows that the amount borrowed was only Shs.100,000/= and the demand now is Shs.14,000,000/=
I have perused the application, the first Defendant confirms that it is entitled to Shs.14,414, 110. 45 as at 7th June 2007 and that there is another suit pending in Embu HCC No. 54/2003. It is a principle of law pronounced by our courts from the time that the bank lender holder of security shall not be prevented from exercising its right of charge to sell security because of dispute of accounts. However in this case the amount demanded is so excessive considering the amount borrowed. There is no sufficient evidence from the bank to show that the amount outstanding is as claimed. The Bank does not exhibit the item of binding. In these circumstances, it is my finding that the court is entitled to interfere to save the property which is said to be family property pending hearing and determination of this suit.
The application is allowed orders granted as prayed.
Costs in the cause.
Dated this 11th February, 2008.
J. N. KHAMINWA
JUDGE
11/2/2008
Khaminwa – Judge
Njue – Clerk
Ms Njeru
Read in open court.
J. N. KHAMINWA
JUDGE