Hotel writes to Court of Appeal over Sh5.2b row with local bank

English Point Marina Beach Hotel in Mombasa. [Denis Kibuchi, Standard]

The Sh5.2 billion dispute between English Point Marina Beach Hotel in Mombasa and Kenya Commercial Bank has taken a new twist after the hotel asked the Court of Appeal to fast-track the case.

In its letter, the hotel wants the court to list the appeal filed by the Kenya Commercial Bank (KCB) to be heard at an earlier date.

Hotel states that the orders issued by that court on May 29, 2023, continue to bring a stalemate on whether in effect, KCB ought to have appointed a receiver manager.

Marina’s lawyer Maloba Anangwe said the orders issued by High Court Judge Dola Chepkwony are still in place, therefore, KCB should have held its horses until its appeal is heard and determined.

“In light of the foregoing, we humbly pray that the present appeal be canvassed by way of oral submissions at the earliest available date, on a priority basis, and at this honourable court’s earliest convenience in light of the preceding circumstances,” Anangwe’s letter read in part.

The hotel had already moved back to the same court arguing that the takeover by KCB over a Sh5 billion loan was in contravention of commercial court orders.

In an application filed with urgency, the hotel argued that although the Court of Appeal lifted the orders of Justice Dora Chepkwony issued on July 12, it did not suspend her earlier orders issued on June 7.

The hotel accused KCB of misinterpreting court orders that were issued and has taken over the hotel under receivership. It claims that KCB is disobeying court orders, adding that it is incurring losses and losing reputation from the actions of the bank.

“The orders of the Court of Appeal did not stay any additional orders and directions of the High Court that were delivered by the Lady Justice Dorah Chepkwony on June 7, 2022, which are still in force pending determination of an application dated June 6, 2022,” the application reads.

It claimed that despite the already challenging economic environment in the country, Marina was forced to incur a higher cost of doing business to maintain its operations due to its restricted liquidity. It accuses KCB of not acting in good faith.

Justice Chepkwony had suspended the bank’s decision to appoint Kamal Bhatt as receiver manager and administrator pending hearing and determination of a suit filed by Marina’s parent company, Pearl Beach Hotels Ltd.

The Court of Appeal suspended Justice Chepkwony’s orders and further hearing at the commercial court. In its appeal, KCB argued the judge erred by issuing the orders as it owed it money which was allegedly not paid.

Marina filed an urgent application before the commercial court, arguing that the bank had irregularly moved to seize the property without following due process.

At the same time, Marina had also asked the Court of Appeal to summon KCB’s directors and the receiver manager to show cause why they should not be sentenced to jail for disobeying a court order.

It asked the court to recall the receiver manager and return the hotel’s management to the owners pending determination of the application.