Retired African Inland Church (AIC) Bishop Silas Misoi Yego lost bid to save prime city property after the High Court declined to stop the auction of his property in Kileleshwa. Bishop Yego had applied and received a Sh 140 million loan from Transnational Bank in 2014. He received the transaction through his company Siro Investment to construct 50 apartments in Kileleshwa. The loan was secured on 7th November 2014.
Bishop Yego is now on the verge of losing his property. He failed to service the loan, prompting Transnational Bank to instruct Purple Royal Auctioneers to recover the loan balance through a public sale as at March 31, 2020. He told the court that his project was faced with issues caused by third parties and arbitration proceedings were initiated and ruled in his favour. The bishop approached the bank last year with a new proposal after falling into arrears in the repayment of the debt. The bank had indicated the amount owed was Sh 116 million.
Bishop Yego had paid Sh 32.6 million between January and November 2019. The repayments reduced the loan amount to Sh 82.35 million. “He had made efforts to clear the loan payments amounting to Sh 34 million within the last few months, with the last instalment being made in January 2020,” read the court documents.
He moved to court to challenge the auction saying the bank had undervalued the property and that the outstanding loan balance was Sh 86 million and not the Sh 143 million quoted by the lender. He also said that the bank had failed to issue him with the required notification of sale. Transnational Bank argued that it had extended sympathy to Bishop Yego on several occasions and a discount on the loan interest was agreed.
By a letter dated 7th February 2019, the Plaintiff indicated that he would settle the loan of Sh 116 million in four instalments. The bank would accept the offer on the condition that the source of repayment would be disclosed. The bank said that the loan would have been cleared within 90 days with all instalments settled on indicated dates without default. The last instalment was to have been received on May 21, 2019.
The bank indicated if the terms were not met the outstanding loan should be paid without any interest waiver. Bishop Yego told the court that he had informed the bank that he had entered into a sale agreement with a third party, Peter Kilonzo who was willing to purchase the suit property for Sh 200 million. The first instalment from the sale which would be used to clear the outstanding loan was due on April 30, 2020. He told the court that the process of the sale stalled in the wake of the Covid-19 pandemic.
Justice David Majanja ruled that since Bishop Yego admitted the indebtedness, he cannot suffer a loss that cannot be compensated by damages. He further added that the cleric understood that the bank was entitled to seizure and auction of the property upon default. “According to the agreement between the parties, the Plaintiff has been in default since 2019. He has not met the promise to settle the debt despite several offers by the bank to accept the settlement,” said Justice Majanja when dismissing the application to stop the bank from auctioning the property.