BY SAM ALFAN .
Absa Bank has been barred from auctioning a prime property in the city to recover a loan of Sh86 million owed by New Mega Africa ltd and Nairobi businessman.
Commercial Court Judge Josephine Mongare barred the lender from selling the Kitusuru property belonging to New Mega Africa ltd and businessman David Abai Omusala.
The businessman runs a transport firm that has defaulted on a Sh86 million loan, which was secured using the Kitusuru property.
“A temporary injunction order be and is hereby issued restraining the bank and its employee or agents from advertising for sale, selling private treaty, or conducting or concluding a public auction of all that land pending the hearing and determina- tion of the suit,” ordered Judge Mong’are.
The judge further issued an order preventing the transfer of the title of the property to a third party pending the determination of the dispute.
Absa Bank had moved to seize the assets to recover unpaid loans, which stood at Sh86.4 million as of September 30, 2022, forcing the company to seek court’s intervention.
The bank said the loan has fallen into arrears and continues to accrue interest, despite its calls for the company to regularise the account.
The orders barring the auction and the transfer of the property comes ten months after another judge slapped the bank with a Sh1.5 billion compensation order for breach of confidentiality
Justice Njoki Mwangi directed the Absa bank to compensate Abai who is a director of New Mega Africa Limited the amount ruling that it was unfair for the bank to have leaked the trader’s financial statements with strangers without his consent.
“The court finds that the bank owed the client a fiduciary and contractual duty, but it was in breach of those duties which caused Abai to lose business and funds. He is entitled to compensation of Sh1,512,533,679 from Absa bank plus in- terest accrued,” ruled Justice Njoki.
The court compensated Abai the compensation for loss of income, goodwill and fixed assets.
The Judge entered the judgement in favour of Abai and his company after Absa failed to defend the lawsuit.
“The defendant herein having been duly served and having failed to file defence within the stipulated period of time, and upon application of the plaintiff’s ad- vocate, I enter interlocutory judgment as prayed,” the judgment reads.
The award comes after the director of New Mega Africa Ltd, a transport company in the country sued the bank claiming that it had violated his rights by disclosing his confidential information to third parties without his permission.
Abai argued that the move by the bank to leak his financial details to strangers without his consent led to financial sabotage in July 2021.
