The High Court has temporarily stopped the planned auction of the high-value 14 Riverside office complex, granting the property’s owners a reprieve just days before the scheduled sale.
Justice Moses Ado issued the interim orders after Cape Holdings Ltd. filed an urgent application challenging the legality of the auction process.
The property had been slated for auction on May 26, 2026.
The court directed Moran Auctioneers to file their response within seven days and scheduled the matter for mention on June 2, 2026.
The stay order will remain in force pending further directions.
The dispute stems from a long-running legal battle between Cape Holdings and Synergy Industrial Credit Ltd., dating back more than 15 years.
The conflict arises from an arbitration award issued in January 2015 in favour of Synergy for Sh1.66 billion.
According to court documents, the amount has since grown to more than sh 10 billion after the application of compound interest at 18 percent per annum.
Cape Holdings, through Senior Counsels Paul Muite and Kioko Kilukumi, argued that the auction process violated mandatory provisions of the Auctioneers Rules, 1997.
In its court documents, the company alleged that Moran Auctioneers relied on an outdated auction notice issued in 2022 instead of serving fresh notices as previously directed by the court.
“The Court Order indicates a reserve price calculated off a valuation conducted close to 6 years ago in contravention of Rule 11 (b) (x) of the Auctioneers Rules which requires the reserve price to be based off a current valuation conducted within 12 months prior to auction,” read the court documents.
It further claimed that the auctioneers failed to properly serve a notification of sale, disclose the reserve price, and conduct an up-to-date valuation of the property.
The company also argued that auction advertisement published on May 7, failed to specify the reserve price and created uncertainty over which portions of the development were being offered for sale.
According to Cape Holdings, several floors or suites within the complex had previously been sold to third parties under long-term lease arrangements.
In a supporting affidavit, Cape Holdings director Bipinchandra Sanghrajka said the company would suffer irreparable harm if the property were sold before the issues raised were determined by the court.
Cape Holdings has also indicated that it intends to mount a constitutional challenge against the accumulation of interest on the original award, arguing that the increase from Sh1.66 billion to over Sh9 billion infringes on constitutional protections relating to property rights.
The latest ruling comes only days after the Court of Appeal declined to grant the company interim relief pending the hearing of its appeal against a March 2, 2026 decision that allowed execution proceedings to continue.
However, Cape Holdings maintains that challenges to the auction process itself properly belong before the High Court.
“During the Court of Appeal hearing on May 18, counsel for Synergy reportedly took the position that the High Court not the appellate court was the correct forum to challenge the auction process itself, a position Cape Holdings has since relied upon in bringing its application,” read the court documents.
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.”
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