A man who guaranteed a loan for his friend has sued a micro lender after losing his property through a recovery auction. The aggrieved man, Kennedy Kimutai Salat, says that he had a friend known as Robert Kanuli who owned a business known as Kanuli Information Technology Solutions Limited.
Kanuli asked Kimutai if he could guarantee a loan of Sh11 million that he wanted to take at Faulu Microfinance Bank. However, Kimutai told him that he could only guarantee be able to guarantee Sh5.6 million out of the Sh11 million loan that Kanuli wanted at Faulu. He then gave him a title deed for a prime property that he owned in Kericho town to act as security for the Sh5.6 million Faulu loan.
All this happened around November 2015. Close to ten years later, Kimutai received a redemption notice and a notice of sale from Antique Auctioneers. These notices were reportedly dated on July 1, 2024.
In the notices, Faulu Microfinance Bank informed Kimutai that it was intending to auction his prime property to recover the loan which Kanuli had defaulted on. The micro lender claimed that the loan had ballooned to Sh32.9 million.
Barely weeks after these notices, the micro lender sold the property via auction to a buyer who was identified as Emmanuel Kibet Kirui. The property was sold at Sh13 million in auction that was conducted in February 2025.
By the time Kimutai went to conduct a search at the lands office to ascertain if his title deed had changed hands, he discovered that the property had already been transferred to the new owner.
He decided to sue, after questioning without solution why the micro lender had assumed his partial guarantee for Sh5.6 million yo have been a full guarantee for the total amount of Sh11 million.
Kimutai also questioned how a Sh11 million loan could have ballooned to Sh32.9 million. In his suit, Kimutai also says that the lender undervalued his property by a lot after selling it at Sh13 million even though the property is worth Sh32.5 million.
In his suit, which he has filed through GKL Advocates, Kimutai has asked the High Court to order the Faulu and the new owner from further dealings with the contested property. He has also asked the court to discharge him from any liability that goes beyond the Sh5.6 million that he guaranteed.
“I have been deprived of property valued at Sh32.5 million while my liability under the charge instrument was limited to Sh5.6 million,” he said in court papers that were filed before High Court Judge Justice Linet Omollo.
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