The Nairobi Upper Hill Hotel is set to be auctioned. The hotel will be auctioned by the National Bank of Kenya (NBK) over a Sh. 447 million debt. The auctioning is set to take place after the court cleared NBK to auction the hotel.
The auctioning was first set to take place in 2023 when the NBK notified the Nairobi Upper Hill Hotel owner Mr. Geoffrey Muotia.
However, Muotia went to court and petitioned to have the auctioning stopped until a determination on his contest over the auction was heard and determined.
In a ruling, Justice Jacqueline Mogeni of the Environment and Land Court ruled that the court had no powers to determine the case. The court declared that Muotia should have filed his petition at the High Court instead.
“Given the foregoing, I find that this court based on the reliefs sought, and a red flag having been raised the earliest, that this Court lacks jurisdiction to proceed further to consider the claim as raised in the plaint and, in the same breath deal with the pending application for an injunction, I down tools,” Justice Mogeni declared.
She further noted that the Nairobi Upper Hill Hotel owner had filed multiple other cases at the High Court in a bid to stop the auctioning from taking place. All these cases had been concluded on the same decision. The cases by Muotia had been heard up to the level of the Appellate court.
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Justice Mogeni in her ruling further observed that it was not disputed that Muotia’s property had been charged to the bank to secure an overdraft, commercial mortgage, and a term loan. Muotia had then gone on a lengthy default in making the agreed repayments, and this had forced the National Bank to issue the statutory notice of sale.
Initially, Muotia had been given an overdraft of Sh. 10 million, a commercial mortgage of Sh. 236 million, and a term of Sh. 35 million. These amounts totaled to Sh. 281 million. After his long defaults, the amount increased to the current outstanding balance of Sh. 447 million.