Ex-MP George Nyanja wins temporary reprieve as Supreme Court halts Karen land dealings

The Supreme Court has temporarily stopped any dealings involving a disputed 25-acre Karen property as it prepares to determine whether land sold through a bank auction can be reclaimed by a borrower.

The apex court stayed execution of the judgment by the Court of Appeal of Kenya delivered on January 30, 2026, and barred the respondents, their servants or agents from possessing, occupying or in any way dealing with the land known as L.R. No. 7583/1 in Karen, Nairobi.

The court further directed that the matter be placed before the Deputy Registrar for case management ahead of an inter partes hearing.

The orders arise from a long-running dispute between Nyanja Holdings Limited, linked to former Limuru Member of Parliament George Nyanja, and Kingdom Bank formerly City Finance Limited.

At the centre of the case is a major legal question with implications for Kenya’s property and lending sectors whether a borrower can recover land sold by a lender under statutory power of sale, or whether compensation is the only remedy once a transaction is completed.

The dispute stems from lending facilities advanced in the early 1990s amounting to about Ksh.8 million and secured by several properties, including the Karen estate.

Court filings show the borrowers claim they paid more than Ksh.54 million over the years but still faced continued demands before the bank sold the Karen land by private treaty to Redmars Holdings Limited for Ksh.60 million.

They argue the property was worth Ksh.295 million and that the transaction was undertaken unlawfully and without a valid forced-sale valuation.

“We paid and paid until we had paid Ksh.54.7 million on an Ksh.11 million overdraft facility. Still, the bank proceeded to sell our properties,” George Nyanja and Enid Nyanja state in court papers.

In 2020, the High Court of Kenya ruled in favour of the borrowers, finding that illegal and unconscionable interest had been charged, that the loan had been overpaid and that the sale of the Karen property was unlawful. The court nullified the transaction and ordered the land returned.

But that decision was overturned in January this year when the Court of Appeal held that once a sale is completed under a bank’s statutory power, the borrower loses the right to reclaim the property and can only pursue damages unless fraud or collusion involving the buyer is proved.

Through their lawyer, the applicants argue that the Supreme Court ruling raises issues of general public importance and conflicts with previous Court of Appeal decisions on flawed or illegal bank sales.

The applicants told the court they feared the Karen land could be sold, subdivided or charged before the appeal is heard, rendering the intended appeal nugatory.

In a replying affidavit, the bank’s legal head Jackson Kimathi argues the law is settled and that borrowers cannot reopen completed sales.