Reprieve for Dubai Bank in legal battle against firm

Mr Hassan Zubeidi. FILE PHOTO | NMG 

The High Court has set aside a default judgment against Dubai Bank Ltd (in liquidation), which had been entered in favour of Kwanza Estates Ltd — one of the firms embroiled in the lender’s liquidation saga — terming it irregular and untenable in law.

Justice Patrick Otieno said the judgment overstepped the authority permitted by law for a deputy registrar to enter a default judgment.

Default judgement in most cases is in favour of a plaintiff when the defendant has failed appear in court or file a response to allegations against him.

“The second reason the judgment must be set out is therefore that it was entered in excess of jurisdiction,” said Justice Otieno.


According to the application by the bank, the suit against it, as framed, did not reveal a liquidated claim hence no judgment could have been sought or obtained in default of appearance.

In his ruling, the judge also allowed the bank’s managing director Hassan Zubeidi to be enjoined in the suit as a defendant.

Mr Zubedi’s application was premised on the grounds that the plaintiff makes allegations against him to the effect that he entered into a memorandum of understanding with Kwanza Estates Ltd managing director and received $2.5 million (about Sh250 million) to deposit in its account but did not do so.

Kwanza Estates has sued Dubai Bank seeking orders, among them, a permanent injunction restraining the bank from advertising for sale or dealing in the plaintiff’s properties in Watamu, Kilifi.

The court had restrained the bank from selling, accessing, advertising for sale, entering into, transferring or dealing with Kwanza Estates’ properties until the case filed against it was heard and determined.

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