Two prime properties belonging to former Cabinet Secretary Raphael Tuju are set to go under the hammer, following a prolonged legal battle with the East Africa Development Bank (EADB) over an outstanding Sh2.2 billion loan. The auction, which was announced in a public notice on September 13, will include Dari Coffee and Garden restaurant and Entim Sidai wellness sanctuary, both located in the affluent Karen area of Nairobi.
The properties, which are prime real estate in one of Nairobi’s most prestigious neighborhoods, are being auctioned due to a dispute between Tuju and the EADB. The former CS has been embroiled in a lengthy legal struggle with the bank over the terms of a loan facility that was agreed upon nearly a decade ago. The auction notice specifies that interested parties must place a mandatory bidding deposit of Sh10 million for each property, either by cheque or cash, reflecting the high stakes involved in this sale.
The roots of this dispute trace back to April 4, 2015, when Tuju and the EADB entered into a written facility agreement. Under this agreement, the bank was to grant Tuju a loan of $9.3 million, intended to support the acquisition and development of commercial properties for resale in Nairobi. However, Tuju claims that the bank did not fully honor the agreement, specifically alleging that a balance of Sh294 million was never disbursed.
Tuju has expressed strong discontent with the bank’s decision to auction his assets, labeling the move as malicious. In an interview with the Star, Tuju accused the bank of using the auction as a means of public humiliation and intimidation. He argued that this action is an attempt to rattle him after years of unsuccessful efforts by the bank to resolve the dispute through legal and extrajudicial means. “For several years, they have tried through malice to publicly humiliate, intimidate, and rattle me. I can only pity them because they have not succeeded in almost eight years. Malice has no logic,” Tuju stated.
Adding to the complexity of the situation, Tuju highlighted that the auction notice was placed despite a pending court decision scheduled for September 18. This decision is expected to address the intricacies of the case, and Tuju finds it peculiar that the auction is being conducted in parallel with ongoing judicial proceedings. He suggested that the timing of the auction could be motivated by financial considerations, such as legal fees and auctioneers’ charges, rather than genuine efforts to resolve the debt issue.
The EADB’s move to auction the properties represents a significant development in this high-profile legal clash. The sale of the Dari Coffee and Garden restaurant and Entim Sidai wellness sanctuary is expected to attract substantial interest due to their valuable locations and the high profile of the former Cabinet Secretary involved. However, the outcome of the auction will likely hinge on the final resolution of the court case and the extent to which the bank and Tuju can negotiate a settlement.
As the auction date approaches, all eyes will be on the court’s forthcoming ruling and any potential resolutions that could emerge from this ongoing dispute. The sale of Tuju’s properties, if it proceeds as planned, will not only impact the former CS’s financial situation but also serve as a prominent example of the high stakes involved in legal and financial conflicts.
