1. The Plaintiff’s Notice of Motion dated 4th August 2025 seeks a temporary injunction restraining the Defendant and the Interested Party from selling, transferring, alienating or otherwise dealing with Land Reference No. 12715/3237, Machakos (“the suit property”) pending the hearing and determination of the suit.
2. The application is supported by the affidavit of Eng. Samay Singh sworn on 4th August 2025, and is opposed by the Replying Affidavit of Anthony Mwangi, sworn on 27th August 2025. The Plaintiff also filed a Further Affidavit sworn on 15th September 2025.
3. The parties filed written submissions, which I have considered.
4. The Plaintiff’s case is straightforward. It states that in July 2014, it obtained from the Defendant an overdraft facility of Kshs. 140,000,000 secured by a charge over the suit property, and that in August 2019, the facility was enhanced by a further Kshs. 105,000,000 secured by a further charge over the same property. The Plaintiff avers that the facility operated as a running overdraft account through which its business proceeds were channelled and that by June 2025, the sums paid into the account exceeded the amounts advanced.
5. The Plaintiff complains that, notwithstanding the alleged repayments, the Defendant instructed the Interested Party to realize the security and issued a 45-day redemption notice demanding Kshs. 214,550,060.90. It contends that the amount demanded comprises unlawful, punitive, and unconscionable interest and penalties contrary to section 44A of the Banking Act. The Plaintiff also faults the Defendant for allegedly failing to issue proper statutory notices and for relying on an outdated valuation report.
6. The Defendant opposed the application on the basis that the Plaintiff admittedly obtained and utilized various banking facilities which remain unpaid. The Defendant states that the Plaintiff repeatedly sought indulgence and restructuring of the facilities and cannot therefore deny indebtedness. The Defendant further maintains that all requisite statutory notices were duly issued and served and that disputes on accounts do not constitute a basis for restraining a chargee from exercising its statutory power of sale.
7. The Interested Party supported the Defendant’s position and submitted that it was merely acting as an agent of a disclosed principal and no substantive relief lay against it.
8. The principles governing the grant of interlocutory injunctions are now settled. In Giella v Cassman Brown & Co. Ltd [1973] EA 358, the court held that an applicant must establish a prima facie case with a probability of success, demonstrate that irreparable injury would result if the injunction is not granted, and, where the court is in doubt, determine the matter on a balance of convenience.
9. In Mrao Ltd v First American Bank of Kenya Ltd & 2 Others [2003] KLR 125, the Court of Appeal defined a prima facie case as one which, on the material presented demonstrates an apparent infringement of a right requiring rebuttal from the opposite party.
10. The relationship between the parties is not disputed. The Plaintiff obtained banking facilities from the Defendant and secured the same by legal charges over the suit property. The Plaintiff also does not deny that the Defendant issued notices demanding repayment of the facilities. The dispute is whether the sums demanded are lawful and whether the Defendant complied with the statutory process preceding realization of the security.
11. I have considered the material before the court, and I am not satisfied that the Plaintiff has established a prima facie case with a probability of success.
12. First, the Plaintiff does not deny indebtedness. Its case is that the sums remitted into the account exceeded the facilities advanced, and that the amount demanded by the Defendant is therefore unlawful and exaggerated. However, the Defendant has exhibited correspondence showing that the Plaintiff repeatedly acknowledged the debt and sought indulgence in repayment. The Plaintiff has not placed before the court a reconciled statement of account demonstrating full repayment of the facilities.
13. Second, although the Plaintiff invokes section 44A of the Banking Act and the in duplum rule, whether the interest charged violates the statute is a matter that would require interrogation of the parties’ accounts at trial. At this interlocutory stage, the Plaintiff has not demonstrated, prima facie, that the amount claimed by the Defendant is unlawful.
14. It is trite that a dispute on accounts or the amount outstanding is not, without more, a ground for restraining a chargee from exercising its statutory power of sale. In NANCY NJOKI KINYANJUI v EQUITY BANK LIMITED [2010] KEHC 1379 (KLR), the Court (M.K. Koome J – as she then was) reiterated that a mortgagee will not ordinarily be restrained merely because the amount due is disputed. The learned judge held as follows: -
“There is no evidence by the plaintiff that she settled the loan. If there is an issue of accounting that is not a ground for granting an order of injunction. The plaintiff having failed to satisfy the 1st condition that is establishing a prima facie case there is no point in interrogating whether the 2nd element has been fulfilled because the conditions are sequential. For those reasons I find the plaintiff’s application for injunction does not meet the threshold of granting an interim order the application is disallowed with costs to the defendant.”
15. Third, the Defendant has exhibited copies of the statutory notices and evidence of service thereof. Although the Plaintiff disputes service, that allegation is not sufficient on the material presently before the court to establish that the realization process is plainly unlawful.
16. Fourth, the complaint regarding valuation does not establish a basis for grant of an injunction. The Defendant has exhibited a valuation report, and the dispute raised by the Plaintiff concerns the valuation figures reflected in the notices. That issue may properly be ventilated at the hearing of the suit.
17. I also agree with the submissions by the Defendant and the Interested Party that no substantive relief lies against the Interested Party, which merely acted as an auctioneer on behalf of a disclosed principal.
18. Having failed to establish a prima facie case, the Plaintiff’s application must fail.
19. In any event, the suit property was offered as security for commercial borrowing, and any loss that may arise from realization thereof is capable of compensation by an award of damages. In Kitur vs Standard Chartered Bank & 2 others (2002) 1KLR the court opined as follows: -
“It must be noted that when a Chargor lets loose its property to a Chargee as security for a loan or any other commercial facility on the basis that in the event of default it be sold by a Chargee, the damages are foreseeable. The security is thenceforth a commodity for sale or possible sale, with the prior concurrence and consent of the Chargor. How then can he, having defaulted to repay loan arrears prompting a chargee to exercise its statutory power of sale, claim that he is likely to suffer loss or injury incapable of compensation by an award of damages? Such an argument is definitely misplaced and has no merits.”
20. The upshot of the foregoing is that the Notice of Motion dated 4th August 2025 is found to be without merit, and is accordingly dismissed with costs to the Defendant and the Interested Party.
21. It is so ordered.
DATED, SIGNED, AND DELIVERED AT NAIROBI
THIS 21ST DAY OF MAY 2026
HON. MR. JUSTICE MOSES ADO
Judge of the High Court
In the Presence of:
Moses C/A
Khaemba………………for the Applicant
Mutua……………for the Respondent
2. The application is supported by the affidavit of Eng. Samay Singh sworn on 4th August 2025, and is opposed by the Replying Affidavit of Anthony Mwangi, sworn on 27th August 2025. The Plaintiff also filed a Further Affidavit sworn on 15th September 2025.
3. The parties filed written submissions, which I have considered.
4. The Plaintiff’s case is straightforward. It states that in July 2014, it obtained from the Defendant an overdraft facility of Kshs. 140,000,000 secured by a charge over the suit property, and that in August 2019, the facility was enhanced by a further Kshs. 105,000,000 secured by a further charge over the same property. The Plaintiff avers that the facility operated as a running overdraft account through which its business proceeds were channelled and that by June 2025, the sums paid into the account exceeded the amounts advanced.
5. The Plaintiff complains that, notwithstanding the alleged repayments, the Defendant instructed the Interested Party to realize the security and issued a 45-day redemption notice demanding Kshs. 214,550,060.90. It contends that the amount demanded comprises unlawful, punitive, and unconscionable interest and penalties contrary to section 44A of the Banking Act. The Plaintiff also faults the Defendant for allegedly failing to issue proper statutory notices and for relying on an outdated valuation report.
6. The Defendant opposed the application on the basis that the Plaintiff admittedly obtained and utilized various banking facilities which remain unpaid. The Defendant states that the Plaintiff repeatedly sought indulgence and restructuring of the facilities and cannot therefore deny indebtedness. The Defendant further maintains that all requisite statutory notices were duly issued and served and that disputes on accounts do not constitute a basis for restraining a chargee from exercising its statutory power of sale.
7. The Interested Party supported the Defendant’s position and submitted that it was merely acting as an agent of a disclosed principal and no substantive relief lay against it.
8. The principles governing the grant of interlocutory injunctions are now settled. In Giella v Cassman Brown & Co. Ltd [1973] EA 358, the court held that an applicant must establish a prima facie case with a probability of success, demonstrate that irreparable injury would result if the injunction is not granted, and, where the court is in doubt, determine the matter on a balance of convenience.
9. In Mrao Ltd v First American Bank of Kenya Ltd & 2 Others [2003] KLR 125, the Court of Appeal defined a prima facie case as one which, on the material presented demonstrates an apparent infringement of a right requiring rebuttal from the opposite party.
10. The relationship between the parties is not disputed. The Plaintiff obtained banking facilities from the Defendant and secured the same by legal charges over the suit property. The Plaintiff also does not deny that the Defendant issued notices demanding repayment of the facilities. The dispute is whether the sums demanded are lawful and whether the Defendant complied with the statutory process preceding realization of the security.
11. I have considered the material before the court, and I am not satisfied that the Plaintiff has established a prima facie case with a probability of success.
12. First, the Plaintiff does not deny indebtedness. Its case is that the sums remitted into the account exceeded the facilities advanced, and that the amount demanded by the Defendant is therefore unlawful and exaggerated. However, the Defendant has exhibited correspondence showing that the Plaintiff repeatedly acknowledged the debt and sought indulgence in repayment. The Plaintiff has not placed before the court a reconciled statement of account demonstrating full repayment of the facilities.
13. Second, although the Plaintiff invokes section 44A of the Banking Act and the in duplum rule, whether the interest charged violates the statute is a matter that would require interrogation of the parties’ accounts at trial. At this interlocutory stage, the Plaintiff has not demonstrated, prima facie, that the amount claimed by the Defendant is unlawful.
14. It is trite that a dispute on accounts or the amount outstanding is not, without more, a ground for restraining a chargee from exercising its statutory power of sale. In NANCY NJOKI KINYANJUI v EQUITY BANK LIMITED [2010] KEHC 1379 (KLR), the Court (M.K. Koome J – as she then was) reiterated that a mortgagee will not ordinarily be restrained merely because the amount due is disputed. The learned judge held as follows: -
“There is no evidence by the plaintiff that she settled the loan. If there is an issue of accounting that is not a ground for granting an order of injunction. The plaintiff having failed to satisfy the 1st condition that is establishing a prima facie case there is no point in interrogating whether the 2nd element has been fulfilled because the conditions are sequential. For those reasons I find the plaintiff’s application for injunction does not meet the threshold of granting an interim order the application is disallowed with costs to the defendant.”
15. Third, the Defendant has exhibited copies of the statutory notices and evidence of service thereof. Although the Plaintiff disputes service, that allegation is not sufficient on the material presently before the court to establish that the realization process is plainly unlawful.
16. Fourth, the complaint regarding valuation does not establish a basis for grant of an injunction. The Defendant has exhibited a valuation report, and the dispute raised by the Plaintiff concerns the valuation figures reflected in the notices. That issue may properly be ventilated at the hearing of the suit.
17. I also agree with the submissions by the Defendant and the Interested Party that no substantive relief lies against the Interested Party, which merely acted as an auctioneer on behalf of a disclosed principal.
18. Having failed to establish a prima facie case, the Plaintiff’s application must fail.
19. In any event, the suit property was offered as security for commercial borrowing, and any loss that may arise from realization thereof is capable of compensation by an award of damages. In Kitur vs Standard Chartered Bank & 2 others (2002) 1KLR the court opined as follows: -
“It must be noted that when a Chargor lets loose its property to a Chargee as security for a loan or any other commercial facility on the basis that in the event of default it be sold by a Chargee, the damages are foreseeable. The security is thenceforth a commodity for sale or possible sale, with the prior concurrence and consent of the Chargor. How then can he, having defaulted to repay loan arrears prompting a chargee to exercise its statutory power of sale, claim that he is likely to suffer loss or injury incapable of compensation by an award of damages? Such an argument is definitely misplaced and has no merits.”
20. The upshot of the foregoing is that the Notice of Motion dated 4th August 2025 is found to be without merit, and is accordingly dismissed with costs to the Defendant and the Interested Party.
21. It is so ordered.
DATED, SIGNED, AND DELIVERED AT NAIROBI
THIS 21ST DAY OF MAY 2026
HON. MR. JUSTICE MOSES ADO
Judge of the High Court
In the Presence of:
Moses C/A
Khaemba………………for the Applicant
Mutua……………for the Respondent