Kenya Auctioneers raid Standard Chartered bank
Published April 12th, 2007
City-based auctioneers have attached all movable assets in 11 branches of the Standard Chartered Bank Kenya over an Sh420 million debt.Keysian Auctioneers employees moved into the bank’s premises on Tuesday and attached the property after the bank failed to pay the money to Manchester Outfitters within 30 days of an order by the Court of Appeal.
By Wednesday evening, the bank was trying to seek court orders to block the auctioneers from selling the property after the usual seven days’ notice.
“The bank has moved back to the Court of Appeal to seek a review of the case before the period expires,” said Ms Anne Njambi, the bank’s spokeswoman.
She, however, confirmed that the bank had signed the notice attaching the property for the period or until the bank pays the money.
The case between Manchester Outfitters and Standard Chartered Bank has been dragging in court for over 15 years. The bank was ordered to pay the money in 2002, but has kept the matter in court since then.
Manchester Outfitters (now known as King Woolen Mills Ltd) had gone to court in 1989 after the bank sold all its assets for failing to pay an Sh19 million loan.
The then High Court judge, Justice Erastus Githinji dismissed the case against Manchester Outfitters only for the Court of Appeal to overturn the judgment in favour of the uniform makers.
According to the documents availed to The Standard, the company approached the bank for the loan in foreign currency and offered its company assets as security. The loan was arranged through Standard Chartered Merchant Bank of London.
The two agreed that the bank would appoint a receiver manager to run the firm should it fail to repay the loan. But due to a currency shortage facing the country at that time, the loan was renegotiated and was paid in local currency under a deal with no provision for the receiver managers.
When the company failed to honour the repayment, the bank went ahead to appoint a receiver manager and later sold the properties
