JOSE ESTATES LIMITED V. MUTHUMU FARM LIMITED,JOSEPH NJOGU NJUGUNA & NATIONAL BANK OF KENYA

JUDGMENT OF THE COURT

In 1992 the appellant, Jose Estates Limited purchased all that piece or parcel of land known as L.R. No. 10551/3, “the suit property” by way of private treaty from National Bank of Kenya, “the 3^rd respondent” (the Bank) for a consideration of Kshs. 15,500,000 in the latter’s exercise of its statutory power of sale. The suit property which belonged to Muthumu Farm Limited, “the 1^st respondent ”, had been charged to the 3^rd respondent as security for financial facilities which it had accorded to Joseph Njogu Njuguna, “the 2^nd respondent ”, in the aggregate sum of Kshs. 5,000,000 between October and December, 1988. The security was for the principal sum aforesaid together with interest at the provisional rate of 15% p.a. revisable with notice to the 1^st and 2^nd respondents.

The 2^nd respondent defaulted in the repayment of the loan so advanced by the 3^rd respondent, who in turn exercised its statutory power of sale by way of private treaty and sold the suit property in…