Equity Bank has received the green light to auction Fourways Junction homes belonging to troubled real estate company Suraya Property Group.
A bench of three judges comprising of Justices Roselyn Nambuye, Hannah Okwengu, and Imaana Laibuta ruled that Equity can sell the houses subject to the issuance of fresh notices, as had been directed by the High Court in 2020.
“The applicant having offered the suit property as security, it has become a commercial entity that can be compensated in monetary value,” the court ruled.
The homes that are up for auctioning were constructed by China Wu-Yi and financed by Equity Bank at more than Sh. 1 billion.
They have been hotly contested in court by China Wu-Yi, Equity Bank, and the Suraya couple of Sue and Peter Muraya.
Suraya Property owners- Peter Muraya and his wife Susan formed Muga Developers with the family of the late Samuel Gatabaki in 2007, for the development of Fourways Junction Estate.
While the Gatabakis provided the land, Suraya was to source for funds. The estate is strategically located a short distance from the leafy Runda Estate.
It holds a mix of cluster houses, apartments, office blocks, a shopping mall, a three-star hotel, and a fully-fledged country club.
China Wu-Yi has also been fighting to get 10 houses as part of the payment for their services. The houses are located at Hibiscus and Tulip apartments in the estate.
In November 2020, the High Court in Nairobi had ruled that China Wu-Yi could not recover the houses because Suraya’s co-developer, Muga Developers, owed Equity.
In court papers, China Wu-Yi said that it struck a deal with the two developers to posses some of the houses as part of the payment for its services in the project that is located along Kiambu Road.
Suraya Property however denied this and said that the property was charged to Equity Bank, which granted the Sh. 1.76 billion cash for the project.
China Wu-Yi says that Suraya advertised in a newspaper in March 2009, a tender for the construction of Fourways Junction, phase I.
The Chinese firm said it completed the job. As at August 2011, the pending certificates had accumulated an outstanding sum of Sh. 166 million.
The parties allegedly engaged in talks and it was proposed that the developer pays Sh. 30 million for bill of quantities, a further Sh. 57 million was to be paid in cash after the houses were sold and the balance of Sh. 79 million was to be repaid by transferring four hibiscus villas and two tulip apartment units to the construction company.
The deal entailed three more hibiscus villas and one tulip apartment to make it seven hibiscus villas and three tulip apartments.
The construction company, however said the real estate company failed to honour the deal, only handed to it four villas and refused to transfer the title of all the house as agreed.
And during routine checks, the company said it met a buyer who said he was in the process of purchasing one of the houses they had agreed, should be transferred to it.