Credit Bank Ltd has been given the green light to sell two properties belonging to a couple in Uthiru, to recover a Sh80 million loan used to fund a failed coal exploration project.
The High Court ruled that Foundation Piling Ltd and its owners, Ronald Njoroge King’ang’i and Bella Wagatwe King’ang’i, had not offered to repay the debt or provided any explanation for their default.
The court also confirmed that the bank had properly served all statutory notices, which the couple did not deny receiving.
‘I am in further agreement with the Bank that its right to recover its debt by realising its security is being frustrated and the loan continues to accrue interest daily and there is a genuine risk that the debt will outstrip the value of the suit properties if the sale is delayed for the duration of a potentially lengthy trial, causing greater loss to the Bank and ultimately to the Plaintiffs, if the suit properties are sold for less than the debt,’ the ruling stated.
The case revolves around loans totalling approximately Sh77.7 million obtained by Foundation Piling Ltd in July 2017 for a coal exploration project that was later abandoned due to its cancellation by the government.
The loans were secured against the two properties and the company claimed that the project’s failure, compounded by the Covid-19 pandemic, left them struggling to repay the debt.
The bank issued a 40-day notice of sale on May 30, 2025, followed by a redemption notice two months later for Sh80.7 million. A notification of sale was subsequently sent, setting an auction for September 2025.
The couple challenged the planned sale, alleging that interest had been charged above agreed rates without the approval of Treasury Cabinet Secretary, in breach of the Banking Act.
They described the demanded sum as ‘outrageous’ and claimed the lender had refused to provide proper statements or reconcile payments made. They further accused the bank of inflating the debt to frustrate their attempts to sell the properties.
Credit Bank, however, insisted that all statutory procedures were properly followed, including the issuance of 90-day notices under Section 90 of the Land Act in January 2025, which the couple acknowledged receiving.
The lender added that it had been accommodating, even issuing a ‘no objection letter’ on March 13, 2025, allowing the couple to sell one of the properties privately.
The court noted that the bank had effectively challenged the couple’s claims. It also observed that the lender had stated, without dispute, that it could compensate the couple for any losses arising from the property sale.
‘I agree that the suit properties have a finite value as evidenced by the valuation report annexed by the Bank and if the sale is ultimately found to have been unlawful, the Plaintiffs can be adequately compensated by an award of damages,’ the court concluded.