Introduction & Background
1. In an application dated 19th May 2026, the 2nd Plaintiff (“the Applicant”) seeks to forestall the auction of the property NTIMA/IGOKI/2777 slated to take place on 3rd June 2026. This court, in its ruling of 23rd June 2025 thwarted a similar attempt noting that the Plaintiffs were undisputably indebted and that they had always been aware of their loan status and that the accusation that the Bank unfairly lumped excessive interest rates and penalties onto the outstanding loan amount are matters that are compensable by way of damages at the conclusion of trial.
2. The court also held that the requisite notices were issued and served upon the Plaintiffs and noted that the Bank had attached valuation reports prepared by Ms. ARK Consultants Limited dated 2nd April 2025, which returned a forced sale value of Kshs. 330,000,00.00 in respect of the property. The court further found that from the auction notice, the Bank intended to auction the charged properties, whose combined forced sale value totals Kshs. 451,500,000.00 against an outstanding loan balance of Kshs. 210,044,019.38 and I took the view that, although the balance of convenience favours enabling the Bank to realize its security and recover the loan, allowing the auction of both properties, whose combined forced sale value far exceeds the outstanding debt, may occasion unnecessary hardship and financial injustice.
3. In the circumstances, I found that a more proportionate approach would be to permit the Bank to proceed with the sale of only one of the two charged properties at this stage, preferably NTIMA/IGOKI/2777, whose forced sale value is higher, so as to preserve the equitable interests involved while enabling partial recovery of the loan. The Bank was thus at liberty to proceed with the sale by public auction of the property NTIMA/IGOKI/2777.
The Application
4. In the present application, the Applicant contends that the planned auction is illegal and fraudulent for reasons that the auction notice relies on a valuation allegedly done on 6th May 2026, giving a market value of Kshs. 393,000,000.00 and a forced sale price of Kshs. 294,750,000.00 which they claim is fictitious because previous valuations by the Bank and the Plaintiffs valuation all showed a consistent appreciation in value ranging from Kshs. 400,000,000.00 to Kshs. 450,000,000.00. That it is logically impossible for the value to have suddenly depreciated in May 2026 and they believe no actual valuation was done on the said 6th May 2026.
5. He avers that selling at such a low price violates Section 97(2) and (3) of the Land Act, which requires the chargee Bank to obtain the best price possible, not a throwaway price, that the auctioneers have not re-advertised the property after a previous auction failed, and the sale seems to be planned in secret excluding the public and the intended auction is described as unjust, illegal, and oppressive.
The Bank’s Reply
6. In response, the Bank relies on the replying affidavit of its Head of Legal Department, Wainaina Francis Ngaruiya, sworn on 26th May 2026. It depones that the Court’s ruling of 23rd June 2025 already found that the Bank had issued all requisite statutory notices and was legally entitled to exercise its statutory power of sale. The Bank confirms the auction is scheduled for 3rd June 2026, and that contrary to the Plaintiffs' claim of secrecy, the auction was advertised in the Daily Nation on 18th May 2026.
7. The Bank confirms a current valuation was done on 6th May 2026 as stated by the Applicant returning a market value of Kshs. 393,000,000.00 and a forced sale value of Kshs. 294, 750,000.00. That the Plaintiffs did not attach any current valuation of their own and raised no issue with the valuers' professionalism. It claims that it asked the valuers to explain the drop-in value from Kshs. 440,000,000.00 in April 2025 to Kshs. 393,000,000.00 in May 2026 and the valuers provided a detailed letter dated 25th May 2026) explaining the decline due to reduced income projections in the Meru hospitality corridor, challenging macroeconomic conditions affecting the hospitality sector, restricted access for inspection as internal access was denied, leading to conservative assumptions and depreciation considering the property is now 7-8 years old. The Bank asserts that the valuation is for auction purposes, which reflects a constrained sale.
8. It claims that the Plaintiffs have no intention of repaying the loan because as of 7th April 2025, the outstanding amount was Kshs. 210,044,019.38 and since then, the Plaintiffs have made minimal payments totaling only about Kshs. 2,191,734.00 in 2025 and Kshs. 1,780,000.00 in 2026 and that the 2026 payments were only made after a court order on 2nd February 2026. The Bank highlights a long history of the Applicant requesting accommodations, including multiple requests for loan restructuring in June 2020 and May 2022, requests for extension of moratorium on principal payments for up to 3 years, repeated requests for overdrafts to pay arrears and requests for extension of loan tenor and review of interest rates. The Bank states it granted many of these requests, but the Plaintiffs still default.
9. The Bank states that the court has already placed an injunction on the other suit property, MERU MUNICIPALITY 1/251, so the Bank is now limited to selling only this property, NTIMA/IGOKI/2777 and no meaningful payments are being made. It states that the Plaintiffs have a remedy in damages if the auction proceeds, but the Bank would be unfairly prevented from recovering its money which would be prejudicial to them. The Bank therefore urges the court to dismiss the Applicant’s application and allow it to proceed with the auction.
Analysis and Determination
10. I have gone through and considered the application, the response and submissions of the parties that were orally highlighted by the parties’ respective counsel. The court is being asked to determine the legality of the auction that is to take place on 3rd June 2026 and whether the Applicant has laid a basis for staying and setting aside the ordered of 23rd June 2025 authorizing the Bank to proceed with auction.
11. The Applicant’s case rests on challenging the Bank’s valuation report dated 6th May 2026 and he argues that it is fictitious and fraudulent because it is lower than previous valuations. The parties agree that under section 97 of the Land Act, the Bank has a duty of care to the Applicant to obtain the best price reasonably obtainable at the time of sale and in that regard, it is required to ensure a forced sale valuation is obtained.
12. It should not be lost that a valuation report is based on the professional and expert opinion of a duly qualified valuer who assessed the value of properties based on accepted parameters. In order to displace a professional valuation, the Applicant must produce clear evidence that the valuation is wrong or at least doubtful. Mere assertions or statements are not sufficient (see Palmy Company Limited v Consolidated Bank of Kenya Limited [2014] KEHC 4811 (KLR).
13. Whereas the Applicant is entitled to question why the value of the suit property is lower than previous valuations, it is not always the case that property values must appreciate. In any case, the Bank’s valuer, Avid Property Limited, provided a detailed, professional, and plausible explanation for the decline. The Applicant’s own valuation report indicates that it was to advise the Applicant on its “Current Open Market Value for Book Purposes” and not its Forced Sale Value for auction purposes, therefore cannot be the basis of challenging the Bank’s report that was clearly based on section 97(2) of the Land Act
14. Even if I am to assume that the property has been undervalued as per the said valuation report, the same does not outrightly entitle the Applicant to an injunction. The Bank rightly submits that a court cannot stop a sale simply because the borrower produces a higher counter-valuation (see Olkasasi Limited v Equity Bank Limited [2015] KEHC 5932 (KLR). This is because any loss suffered by the Applicant as a result of the undervalue represented by the difference in valuation, is a finite value which represents damages that the Applicant has not shown that the Bank is incapable of paying.
15. The Applicant must show the Bank’s valuation is wrong on professional grounds such as the incompetence of the valuer or consideration of irrelevant factors. The Applicant has not questioned the Bank’s valuer’s competence or provided any professional critique beyond mere argument. I therefore reject the Applicant’s entreaty that seeks an injunction based on his dispute of the valuation figures of the property.
16. I can only restate that the court’s previous ruling found the Bank was entitled to exercise its statutory power of sale over this exact property, NTIMA/IGOKI/2777 and the court specifically allowed the Bank to proceed with the sale of this property while only protecting the other property, Meru Municipality Block 1/251. The court found the Applicant had not established a prima facie case on ownership or the loan dispute. The Applicant has not shown an infringement of a clear right as the Bank has followed the law having issued statutory notices, obtained a current forced-sale valuation, and advertised the auction in the Daily Nation on 18th May 2026.
17. The Applicant’s claim of a "fraudulent" valuation is unsupported by evidence and therefore, no prima facie case has been established in this case. Any injury would be the loss of the property which is quantifiable in monetary terms and the Applicant’s remedy, if the sale is ultimately found to be improper, lies in damages. Damages are considered an adequate remedy because the property has an ascertainable value.
18. The balance of convenience strongly favors the Bank as the Applicant has admitted default, has made only minimal payments and has a long history of seeking accommodations without fully repaying. The Bank is entitled to recover its money and further stopping the sale would allow the debt to continue growing, potentially exceeding the property's value, to the Bank's detriment and prejudice.
Conclusion and Disposition
19. The upshot is that the Applicant has not made out a case to stop the auction. The application dated 19th May 2026 is dismissed, and the Bank is allowed to proceed with the auction slated for 3rd June 2026.
DATED, SIGNED AND DELIVERED IN NAIROBI
THIS 2ND DAY OF JUNE 2026.
F. MUGAMBI
JUDGE
1. In an application dated 19th May 2026, the 2nd Plaintiff (“the Applicant”) seeks to forestall the auction of the property NTIMA/IGOKI/2777 slated to take place on 3rd June 2026. This court, in its ruling of 23rd June 2025 thwarted a similar attempt noting that the Plaintiffs were undisputably indebted and that they had always been aware of their loan status and that the accusation that the Bank unfairly lumped excessive interest rates and penalties onto the outstanding loan amount are matters that are compensable by way of damages at the conclusion of trial.
2. The court also held that the requisite notices were issued and served upon the Plaintiffs and noted that the Bank had attached valuation reports prepared by Ms. ARK Consultants Limited dated 2nd April 2025, which returned a forced sale value of Kshs. 330,000,00.00 in respect of the property. The court further found that from the auction notice, the Bank intended to auction the charged properties, whose combined forced sale value totals Kshs. 451,500,000.00 against an outstanding loan balance of Kshs. 210,044,019.38 and I took the view that, although the balance of convenience favours enabling the Bank to realize its security and recover the loan, allowing the auction of both properties, whose combined forced sale value far exceeds the outstanding debt, may occasion unnecessary hardship and financial injustice.
3. In the circumstances, I found that a more proportionate approach would be to permit the Bank to proceed with the sale of only one of the two charged properties at this stage, preferably NTIMA/IGOKI/2777, whose forced sale value is higher, so as to preserve the equitable interests involved while enabling partial recovery of the loan. The Bank was thus at liberty to proceed with the sale by public auction of the property NTIMA/IGOKI/2777.
The Application
4. In the present application, the Applicant contends that the planned auction is illegal and fraudulent for reasons that the auction notice relies on a valuation allegedly done on 6th May 2026, giving a market value of Kshs. 393,000,000.00 and a forced sale price of Kshs. 294,750,000.00 which they claim is fictitious because previous valuations by the Bank and the Plaintiffs valuation all showed a consistent appreciation in value ranging from Kshs. 400,000,000.00 to Kshs. 450,000,000.00. That it is logically impossible for the value to have suddenly depreciated in May 2026 and they believe no actual valuation was done on the said 6th May 2026.
5. He avers that selling at such a low price violates Section 97(2) and (3) of the Land Act, which requires the chargee Bank to obtain the best price possible, not a throwaway price, that the auctioneers have not re-advertised the property after a previous auction failed, and the sale seems to be planned in secret excluding the public and the intended auction is described as unjust, illegal, and oppressive.
The Bank’s Reply
6. In response, the Bank relies on the replying affidavit of its Head of Legal Department, Wainaina Francis Ngaruiya, sworn on 26th May 2026. It depones that the Court’s ruling of 23rd June 2025 already found that the Bank had issued all requisite statutory notices and was legally entitled to exercise its statutory power of sale. The Bank confirms the auction is scheduled for 3rd June 2026, and that contrary to the Plaintiffs' claim of secrecy, the auction was advertised in the Daily Nation on 18th May 2026.
7. The Bank confirms a current valuation was done on 6th May 2026 as stated by the Applicant returning a market value of Kshs. 393,000,000.00 and a forced sale value of Kshs. 294, 750,000.00. That the Plaintiffs did not attach any current valuation of their own and raised no issue with the valuers' professionalism. It claims that it asked the valuers to explain the drop-in value from Kshs. 440,000,000.00 in April 2025 to Kshs. 393,000,000.00 in May 2026 and the valuers provided a detailed letter dated 25th May 2026) explaining the decline due to reduced income projections in the Meru hospitality corridor, challenging macroeconomic conditions affecting the hospitality sector, restricted access for inspection as internal access was denied, leading to conservative assumptions and depreciation considering the property is now 7-8 years old. The Bank asserts that the valuation is for auction purposes, which reflects a constrained sale.
8. It claims that the Plaintiffs have no intention of repaying the loan because as of 7th April 2025, the outstanding amount was Kshs. 210,044,019.38 and since then, the Plaintiffs have made minimal payments totaling only about Kshs. 2,191,734.00 in 2025 and Kshs. 1,780,000.00 in 2026 and that the 2026 payments were only made after a court order on 2nd February 2026. The Bank highlights a long history of the Applicant requesting accommodations, including multiple requests for loan restructuring in June 2020 and May 2022, requests for extension of moratorium on principal payments for up to 3 years, repeated requests for overdrafts to pay arrears and requests for extension of loan tenor and review of interest rates. The Bank states it granted many of these requests, but the Plaintiffs still default.
9. The Bank states that the court has already placed an injunction on the other suit property, MERU MUNICIPALITY 1/251, so the Bank is now limited to selling only this property, NTIMA/IGOKI/2777 and no meaningful payments are being made. It states that the Plaintiffs have a remedy in damages if the auction proceeds, but the Bank would be unfairly prevented from recovering its money which would be prejudicial to them. The Bank therefore urges the court to dismiss the Applicant’s application and allow it to proceed with the auction.
Analysis and Determination
10. I have gone through and considered the application, the response and submissions of the parties that were orally highlighted by the parties’ respective counsel. The court is being asked to determine the legality of the auction that is to take place on 3rd June 2026 and whether the Applicant has laid a basis for staying and setting aside the ordered of 23rd June 2025 authorizing the Bank to proceed with auction.
11. The Applicant’s case rests on challenging the Bank’s valuation report dated 6th May 2026 and he argues that it is fictitious and fraudulent because it is lower than previous valuations. The parties agree that under section 97 of the Land Act, the Bank has a duty of care to the Applicant to obtain the best price reasonably obtainable at the time of sale and in that regard, it is required to ensure a forced sale valuation is obtained.
12. It should not be lost that a valuation report is based on the professional and expert opinion of a duly qualified valuer who assessed the value of properties based on accepted parameters. In order to displace a professional valuation, the Applicant must produce clear evidence that the valuation is wrong or at least doubtful. Mere assertions or statements are not sufficient (see Palmy Company Limited v Consolidated Bank of Kenya Limited [2014] KEHC 4811 (KLR).
13. Whereas the Applicant is entitled to question why the value of the suit property is lower than previous valuations, it is not always the case that property values must appreciate. In any case, the Bank’s valuer, Avid Property Limited, provided a detailed, professional, and plausible explanation for the decline. The Applicant’s own valuation report indicates that it was to advise the Applicant on its “Current Open Market Value for Book Purposes” and not its Forced Sale Value for auction purposes, therefore cannot be the basis of challenging the Bank’s report that was clearly based on section 97(2) of the Land Act
14. Even if I am to assume that the property has been undervalued as per the said valuation report, the same does not outrightly entitle the Applicant to an injunction. The Bank rightly submits that a court cannot stop a sale simply because the borrower produces a higher counter-valuation (see Olkasasi Limited v Equity Bank Limited [2015] KEHC 5932 (KLR). This is because any loss suffered by the Applicant as a result of the undervalue represented by the difference in valuation, is a finite value which represents damages that the Applicant has not shown that the Bank is incapable of paying.
15. The Applicant must show the Bank’s valuation is wrong on professional grounds such as the incompetence of the valuer or consideration of irrelevant factors. The Applicant has not questioned the Bank’s valuer’s competence or provided any professional critique beyond mere argument. I therefore reject the Applicant’s entreaty that seeks an injunction based on his dispute of the valuation figures of the property.
16. I can only restate that the court’s previous ruling found the Bank was entitled to exercise its statutory power of sale over this exact property, NTIMA/IGOKI/2777 and the court specifically allowed the Bank to proceed with the sale of this property while only protecting the other property, Meru Municipality Block 1/251. The court found the Applicant had not established a prima facie case on ownership or the loan dispute. The Applicant has not shown an infringement of a clear right as the Bank has followed the law having issued statutory notices, obtained a current forced-sale valuation, and advertised the auction in the Daily Nation on 18th May 2026.
17. The Applicant’s claim of a "fraudulent" valuation is unsupported by evidence and therefore, no prima facie case has been established in this case. Any injury would be the loss of the property which is quantifiable in monetary terms and the Applicant’s remedy, if the sale is ultimately found to be improper, lies in damages. Damages are considered an adequate remedy because the property has an ascertainable value.
18. The balance of convenience strongly favors the Bank as the Applicant has admitted default, has made only minimal payments and has a long history of seeking accommodations without fully repaying. The Bank is entitled to recover its money and further stopping the sale would allow the debt to continue growing, potentially exceeding the property's value, to the Bank's detriment and prejudice.
Conclusion and Disposition
19. The upshot is that the Applicant has not made out a case to stop the auction. The application dated 19th May 2026 is dismissed, and the Bank is allowed to proceed with the auction slated for 3rd June 2026.
DATED, SIGNED AND DELIVERED IN NAIROBI
THIS 2ND DAY OF JUNE 2026.
F. MUGAMBI
JUDGE