KCB Bank has been stopped from taking over the English Point Marina hotel in Mombasa over a Ksh.4.8 billion debt dispute.
Justice Dorah Chepkwony ordered the restraining orders until a plea filed by the facility is heard and determined.
The lender was also barred from appointing a receiver or receiver managers, administrators, or exercising its rights under the obligation.
The bank had appointed Kamal Anatroy Bhatt as receiver because it intended to sell part or all of the property in order to collect enough funds to recover its monies.
The hotel owner, Pearl Beach Hotels, filed a lawsuit, saying that the appointment of the receiver was not only “premature, but also misconceived and designed to undermine the Hotel’s right of redemption.”
The hotel accused the bank of “irregularly, unprocedurally, and illegally appointing a receiver without due notice and complete lack of rationale under the debenture instruments”.
The petitioner’s lawyer, Nick Ndeda further told the court that the hotel’s directors, Nazir Jinnah and Alnoor Kanji, and their families reside in Penthouses D1 and D2 on the site, but that the appointed receiver has denied them entry.
Pearl Beach Hotels claims that it has been actively and consistently engaging KCB bank in an attempt to resolve an accounting error on the bank’s side that resulted in an excess charge of Ksh.893,786,194, rendering the loan amortization schedule impossible to calculate.
The hotel has confirmed that indeed KCB bank supplied credit facilities of Sh4.8 billion for construction through several loan agreements.
“The facilities were secured inter alia by charges over all the property known as subdivision no.6628/1/MN English point Mombasa,” reads court documents.
The matter has been certified as urgent.
Amin Kanji, his wife Leila, brother Alnoor, sister-in-law Nafisa, and Nazir Jinnah own English Point Marina. The luxurious property has 96 apartments, eight penthouses, and a 26-room hotel and is located near the harbor.
It’s one of the few private-sector projects granted the Vision 2030 Private Sector Flagship.