The Court of Appeal has upheld Supreme Court judgement on National Bank of Kenya (NBK) Ksh 2.2 billion compensation to former MP Basil Criticos.
The Supreme Court awarded Basil the aforementioned amount in compensation following NBK’s move to auction his sisal farm 14 years ago.
NBK objected the ruling on grounds that settling the bill will push the lender into losses and further affecting its operations.
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Court of Appeal judges, Justices Hannah Okwengu, Ali-Aroni and John Mativo agreed that the bill is huge, however, noting that the case did not meet the threshold of public interest for Supreme Court’s hearing.
“The dispute between the parties was a commercial loan between a lender, borrower and guarantor. The applicant has not shown how a private commercial agreement between the parties and failure to
repay a loan is a matter of general public importance,” the judges said.
Basil was awarded the compensation after it was established that the auction of the land in Taita Taveta was undervalued.
The 15,994.5 acres of land had buildings, sisal, quarry and road network.
As a result , in May, Court of Appeal judges, Justices Roselyn Nambuye, Wanjiru Karanja and Patrick Kiage ordered the lender to pay Basil.
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“In the result, subject to what we shall shortly state with regard to the crops, we find the appellant’s valuation report to be solid in content and uncontroverted. It was not to be merely wished away
“And we are on balance persuaded by the appellant’s contention that the suit property was sold at an undervalue,” they said.
The land was sold to the Settlement Fund Trustees (SFT) to recover a KSh 20 million loan which was given to a company in which Criticos was a director.
The former lawmaker had acted as a guarantor.
In addition to the compensation, the bank was also directed to pay Criticos KSh 35 million surplus for the sale.
NBK was also put on the spot over excessive interest rates, declining the former MP’s offers to redeem the debt and selling the property at less than the amount he offered.
The bank sold the land to SFT for KSh 55 million through a private treaty, while the case was pending in court.
NBK had demanded KSh 66.5 million plus 35 percent interest from Agro Development Company where Criticos was a director and shareholder.