In a significant ruling for Kenya’s banking sector, the High Court has handed Housing Finance (HF) Group a major victory, dismissing a developer’s attempt to block the auction of prime properties in the leafy suburb of Tigoni.

The dispute, centering on a Sh76 million loan facility, had dragged on with the borrower making startling claims that the debt had been "repaid twice." Justice David Majanja (or the presiding judge) found these claims unsubstantiated, effectively clearing the path for the lender to exercise its statutory power of sale. The ruling sends a chilling message to defaulters: the courts will not entertain frivolous injunctions designed to stall the recovery of non-performing loans (NPLs).

The Core of the Dispute

The borrower had approached the court seeking a permanent injunction, arguing that HF’s accounting was flawed and that the debt had been fully settled. However, HF’s legal team presented a watertight case, demonstrating a clear trail of default and unpaid interest. The court noted that "he who alleges must prove," and the developer failed to provide concrete evidence of the alleged double repayment.

This case highlights the growing aggression of Kenyan lenders in recovering assets as the economy tightens.

• The Asset: Prime land in Tigoni, Kiambu County, a high-value area known for its tea plantations and luxury real estate.
• The Precedent: The ruling reinforces the sanctity of the charge document, affirming that lenders have the right to liquidate security when terms are breached.
• The Impact: It offers relief to HF Group, which has been aggressively cleaning up its loan book to improve liquidity and profitability.

A Warning to Developers

The real estate sector has been grappling with a liquidity crunch, leading to a spike in auctions. For developers, this ruling is a stark reminder of the risks of leverage. The "Tigoni Row" is now effectively over, and the auctioneers’ hammer is poised to fall. For HF, the recovery of this Sh76 million is a boost to their bottom line; for the developer, it is a costly lesson in the unforgiving arithmetic of secured lending.