JUDGMENT OF THE COURT
1. Two key issues arise in this appeal. First is whether a secured lending bank that has a mortgage protection policy is entitled to continue charging interest on a borrower’s account when a notice of death of the borrower has been given to the bank; second, if the estate of the deceased borrower is entitled to release of security as at the date of death and whether the lending bank’s rights are converted from realizing the security given to realizing the sum insured under the mortgage protection policy.
2. The appellant, Anne N. Parmena, is the legal representative of the estate of Dr. William Kaaya Parmena who died on 20th April 1999.
3. Before his death, the deceased Dr. William Parmena on 24th August 1998 had borrowed the sum of Kshs.1.5 million from the respondent. The letter of Offer to Advance from the respondent Housing Finance Company of Kenya is dated 24th August 1998. In the letter, one of the special conditions is that the offer is subject to an insuranc…