The High Court has issued a stay order blocking the auction of the prestigious 14 Riverside office complex, delivering a last-minute reprieve to the property’s owners just days before the sale was scheduled to take place.
Justice Moses Ado granted the interim orders on Saturday following an urgent application by Cape Holdings Ltd., the owners of the 14 Riverside Drive property, who argued that the auction process was riddled with procedural irregularities.
The auction, planned for Tuesday, has been halted pending further directions from the court.
The auctioneers have been given seven days to respond to Cape Holdings’ submissions, with the matter scheduled for mention on June 2.
The legal battle between Cape Holdings and Synergy Industrial Credit Ltd. traces back to an arbitration award issued in January 2015, which found in favour of Synergy in the sum of sh 1.66 billion.
With compound interest at 18 per cent per annum, the decretal amount has since ballooned to over sh 10 billion, according to court documents.
At the heart of the current dispute is the intended auction of the mixed-use commercial complex, which includes office blocks, a hotel component, and a parking silo.
Cape Holdings, represented by Senior Counsels Paul Muite and Kioko Kilukumi, filed an urgent application on May 22, arguing that Moran Auctioneers had failed to comply with mandatory provisions of the Auctioneers Rules, 1997.
According to court documents, Cape Holdings raised multiple complaints about the auction process, including that the auctioneers relied on a stale notice of auction from 2022 rather than issuing fresh notices as directed by the court.
The company also alleged that the auctioneers failed to serve the requisite notification of sale, did not properly disclose the reserve price, and relied on a valuation that was nearly six years old.
“The auctioneers have flagrantly disregarded the mandatory legal requirements, notices, and procedures prescribed under the Auctioneers Rules,” read the court documents.
Cape Holdings argued that the auction advertisement published on May 7 did not disclose the reserve price and created confusion about what portion of the property was actually being sold, given that four floors or suites had previously been sold on long leases to third parties.
The company further indicated it is preparing a constitutional challenge arguing that the accumulation of interest from sh 1.66 billion to more than sh 9 billion violates constitutional protections on the right to property.
“The Applicant stands to suffer irreparable loss if the orders sought are not granted, as the Subject Property is a unique immovable asset and its sale through a flawed process would result in irreversible loss,” the supporting affidavit of Cape Holdings director Bipinchandra Sanghrajka stated.
Just days earlier, on May 18, the Court of Appeal had declined to grant Cape Holdings an interim injunction pending the determination of its appeal against a March 2, 2026 ruling that allowed execution to proceed.
However, counsel for Synergy reportedly told the Court of Appeal that the High Court not the appellate court was the correct forum to challenge the auction process itself.
Speaking after the stay was granted, Cape Holdings said in a statement: “We are pleased that the court has agreed to grant a stay of auction.
This is a significant step in achieving justice for what we have suffered these past 15 years. The road ahead is still long and we intend to continue fighting for our rights and for a fair resolution to this dispute which has gone on for too long.”
