Gulf African Bank to auction South C's Beyruha Academy over Sh60m loan

Gulf African Bank is set to auction a school in South C, Nairobi, over a Sh60 million loan despite a court’s extension of orders barring the exercise.

Justice Wilfrida Okwany extended the orders last week but the lender has instructed Leakey’s Auctioneers Ltd to proceed as school owner Sagal Investment Ltd has failed to service the loan.

Beyruha Academy, established in 1988 and located in Five Star estate Phase II, is set to be auctioned on Wednesday.

It has a pre-primary and integrated school and sits on 0.1470 hectares of land.

The owners are worried that the school might be auctioned despite the court ruling.

What happened

When the parties appeared before Justice Okwany on August 21, the court extended the interim orders on condition that Sagal and Beyruha continue to service the loan.

While rushing to court, the school alleged that the bank failed to serve a statutory notice as required in law.

Beyruha said Gulf African instead gave a 40-day notice and thereafter served a redemption notice requiring it to redeem the charged property within 45 days, failure of which the school would be sold.

The court heard that the school is the guarantor of the loan and that the lender threatened to auction it alongside the Sagal director’s personal property.

Sagal and Beyruha have disputed the amount demanded by the bank.

The case will be heard on December 10.