The High Court in Eldoret has cleared Kenya Commercial Bank (KCB) to proceed with the auction of a commercial property owned by businessman Emmanuel Kipchirchir Mutai after he lost in his attempt to block the sale over a loan default that has grown to more than KSh285 million.
In a judgment delivered by, Justice. Nyakundi, the Court found that the bank had complied with all legal requirements before initiating the sale and was therefore entitled to exercise its statutory power of sale under the Land Act.
Mutai had moved to court seeking an extension of time to redeem the charged property, Eldoret Municipality Block 7/327, and a permanent injunction restraining KCB from selling it. He argued that delays in securing tenants for the commercial building, reduced rental income and the prevailing economic hardships had affected his ability to service the mortgage. He also told the court that he intended to sell another property to settle the outstanding loan if granted additional time.
Court documents showed that KCB had advanced mortgage facilities amounting to KSh196.4 million to finance the construction of the commercial development in Eldoret. However, after years of default, the outstanding debt had increased to KSh285.7 million by November 2025 due to accumulated arrears and interest. The bank told the court that it had fully complied with the statutory requirements under the Land Act by issuing demand notices, statutory notices, redemption notices, valuation reports and notifications of sale before instructing auctioneers to proceed with the sale.
In dismissing the suit, Justice Nyakundi noted that Mutai had admitted borrowing the money and acknowledged falling into default. The judge further observed that the businessman had not presented any credible proposal or evidence demonstrating his ability to redeem the property within the additional time sought.
“The plaintiff failed to discharge the burden of proof that would justify the court interfering with the bank’s statutory power of sale,” Justice Nyakundi ruled.
The court emphasized that although borrowers retain the right to redeem charged property, courts cannot rewrite contracts voluntarily entered into by parties or prevent lenders from recovering outstanding debts where they have complied with the law. Justice Nyakundi further held that disputes over the amount owed or requests for more time, without evidence of fraud, illegality or procedural impropriety, are insufficient grounds to restrain a lender from exercising its statutory power of sale.
The Court also ruled that KCB had complied with Sections 90 to 97 of the Land Act.
