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Equity Centre in Nairobi upperhill.
The High Court has ordered a Chinese construction company to hand over to commercial lender Equity Bank Ltd 10 housing units at Fourways Junction Kiambu to settle unpaid loan owed by the owners of the project.
In the ruling rendered by Justice David Majanja, the court has ordered China Wu-Yi Company Limited to hand over the housing units situated at Hibiscus Villas and Tulip Apartments.
The houses are owned by Muga Developers Limited and they were built using various loan facilities of undisclosed amount, borrowed ten years ago from Equity Bank. The project comprises housing units and ancillary facilities.
The ten units are in control of the Chinese firm, which constructed them and is claiming a debt of Sh73 million.
Muga is also yet to repay the entire amount borrowed from the bank and has an undisclosed balance, which the lender is trying to recover by taking over the houses.
Muga took the various loans from the bank in 2011 and 2012 and also appointed Suraya Property Group Limited as its agent to sell the housing units to prospective purchasers.
The Chinese contractor has been holding on the property as it is also claiming a debt of Sh73.6 million from both Muga and Suraya.
But the bank opposed and informed court that the contractor does not have any claim over the houses thus the continued possession was unlawful.
Equity stated that the refusal to hand over the houses was in contravention of an earlier finding by the court that the contractor had no claim over the houses.
While ruling in favour of the bank, the court noted that it is common ground that the financial facility which the bank granted the developers has not been repaid in full.
He said the contractor does not have proprietary interest in the suit property that would defeat the Bank’s securities.
“It is my considered opinion, any person who lays claim to the ownership of any housing units which are on the property charged to the bank, should strive to ensure that the bank loan was paid of,” said the judge. – businessdailyafrica.com