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Government and Policy

Court of Appeal Stops Sale of 14 Riverside Pending Hearing

BY Soko Directory Team · January 27, 2022 10:01 am

KEY POINTS

The Court of Appeal ruling, led by justices Daniel Musinga, Wanjiru Karanja, and Agnes Murgor put on hold the planned auction of the 14 Riverside complex with a hearing scheduled for March 18 to determine its fate.

KEY TAKEAWAYS

James Ochieng Oduol, awarded Synergy a sum of 1.67 billion shillings in 2015 that has, since then hit 4.9 billion shillings (compounded at 18 percent).  

Synergy’s plan to auction the 14 Riverside Drive complex over a long-standing dispute has been halted by the Court of Appeal.

The property had been put up for auction early in January by Moran Auctioneers over a debt of 5 billion shillings. This was after Cape Holdings, the owners of 14 Riverside Drive, lost a decade-long battle with the court which seemingly sided with Synergy Industrial Credit.

Synergy Industrial Credit, which had acquired part of the property had been given the go-ahead by the High Court in December 2021 to auction the complex after dismissing an application by I&M bank and its administrator to stall the sale over a 2.82-billion-shilling debt.

After the dismissal, the bank moved to the Court of Appeal with a view of stopping the sale, pending the hearing of its appeal.

I&M wanted the court to determine who, between the debenture holder and the decree-holder had the priority attached to the attached property.

It argued that if the sale went through, it would jeopardize its plans to recover the debt it was owed.

ALSO READ: On What Basis Did The Court Award “Damages” To “Aggrieved Parties” Of 14 Riverside

Justice Mabeya, in his December ruling, however, dismissed the bank’s application and insisted that it would not suffer prejudice since it had other securities. He noted that stopping the sale would leave Synergy with irreparable losses due to delayed recovery of their money.

Synergy had paid a total of 750 million shillings for part of the 14 Riverside Drive apartments but the deal went sideways when it withdrew from the agreement and demanded a refund of the cash that had been paid.

The matter was referred to an arbitrator in 2012 against Cape Holding’s resolve to amicably settle the matter outside the court.

This kicked off one of the longest arbitrations in Kenya. The arbitrator, James Ochieng Oduol, awarded Synergy a sum of 1.67 billion shillings in 2015 that has, since then hit 4.9 billion shillings (compounded at 18 percent).  The Arbitrator awarded the damages in interest, opportunity cost, and foreign exchange.

Meanwhile, the Court of Appeal ruling, led by justices Daniel Musinga, Wanjiru Karanja, and Agnes Murgor put on hold the planned auction of the property with a hearing scheduled for March 18 to determine its fate.

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