Hussein Alibhai Pirbhai’s KSh195 million bid for L.R. No. 209/8619 has triggered a legal battle with Middle East Bank.
The Environment and Land Court has frozen the Industrial Area property pending determination of the dispute.
Justice Charles Gitonga Mbogo barred Middle East Bank from selling, transferring, leasing, charging, or otherwise dealing with it.
The orders were issued on September 3, 2026, pending the hearing and determination of the suit.
L.R. No. 209/8619 stands near the junction of Nanyuki and Tanga roads, Nairobi.
The dispute traces back to a public auction conducted by Middle East Bank on November 21, 2023.
Hussein Alibhai Pirbhai emerged as the highest bidder, offering KSh195 million for the property.
He immediately paid KSh19.5 million, representing 10 per cent of the purchase price, and signed a memorandum of sale.
The transaction, however, soon became entangled in separate litigation concerning the same property.
That dispute would ultimately frustrate the anticipated transfer and trigger a complicated contractual battle.
Auction Turns Sour
According to Pirbhai and Tranquility Holdings Limited, the purchase proceeded beyond the initial deposit.
They say Tranquility Holdings remitted KSh175.75 million on February 20, 2024, completing their financial obligations.
They consequently expected Middle East Bank to proceed with completion and transfer of the property.
Instead, an injunction issued in separate proceedings stood between the buyers and their intended acquisition.
Arboretum Plaza Limited had challenged dealings involving the same property in Commercial Case E594 of 2023.
The proceedings resulted in orders restraining transfer of L.R. No. 209/8619 while that dispute remained pending.
The applicants alleged Middle East Bank knew about those restrictions while receiving their purchase money.
They further complained that their funds remained tied up, creating mounting financial pressure on Tranquility Holdings.
The company said its short-term financing facility attracted interest at an annual rate of 8.75 per cent.
With completion stalled, the applicants eventually sought repayment of the purchase-price balance from Middle East Bank.
The balance was refunded on November 12, 2024, while the bank retained the KSh19.5 million deposit.
That retained deposit subsequently became one of the dispute’s most important financial flashpoints.
Meanwhile, the separate Arboretum Plaza litigation eventually collapsed on procedural grounds.
On July 31, 2025, Justice Peter Mulwa struck out the separate case after finding summons had not been properly served.
The decision removed the immediate legal obstacle that had complicated the property’s proposed transfer.
Pirbhai and Tranquility Holdings subsequently renewed their demand for completion of the transaction.
They formally demanded completion from Middle East Bank on September 11, 2025, but received no satisfactory response.
The buyers then returned to court seeking protection against any sale, transfer, or encumbrance.
They also asked the court to compel Middle East Bank to complete the property’s transfer.
That request became the most consequential part of their interlocutory application.
Bank Fights Transfer
Middle East Bank disputed the applicants’ account and challenged whether the sale agreement remained enforceable.
The bank accepted Pirbhai won the auction at KSh195 million and paid the KSh19.5 million deposit.
However, it disputed that the applicants completed their purchase obligations under the agreement.
The bank instead relied on letters written by Tranquility Holdings in October 2024 seeking withdrawal.
A letter dated October 4 requested repayment of payments made towards the property.
Another letter dated October 14 expressly communicated rescission of the sale and demanded repayment.
The bank argued those communications terminated the agreement and triggered contractual forfeiture of the deposit.
The memorandum provided for forfeiture where purchasers failed to pay the balance within ninety days.
Middle East Bank consequently maintained that no enforceable sale remained between the parties.
Justice Mbogo declined to resolve that contractual dispute at the interlocutory stage.
The judge held that determining default and forfeiture required evidence during the substantive hearing.
The court therefore rejected the applicants’ request for immediate specific performance of the sale.
“This prayer is premature at this juncture,” Justice Mbogo stated while declining the mandatory injunction.
The applicants nevertheless secured an important victory by obtaining orders preserving the disputed property.
Justice Mbogo found they had established a prima facie case raising several questions requiring determination.
The court then applied the established three-part test governing temporary injunction applications.
Applicants must demonstrate a prima facie case, irreparable injury and, where necessary, favourable balance of convenience.
Potential Property Loss
Justice Mbogo found the applicants’ evidence sufficiently arguable to satisfy the initial threshold.
He also considered the potential loss of both the property and the KSh19.5 million deposit.
The judge concluded that such potential loss constituted sufficiently serious harm requiring immediate preservation.
“The balance of convenience lies in favour of granting the temporary injunction,” he ruled.
The court separately granted an inhibition under the Land Registration Act against dealings with the property.
The order blocks any transfer, sale, lease, charge or other registered dealing involving L.R. No. 209/8619.
The measure effectively places the KSh195 million property in legal lockdown pending trial.
The latest decision follows another important ruling delivered earlier this year in the same dispute.
In February 2026, Justice Mbogo rejected Middle East Bank’s attempt to strike out the substantive proceedings.
The bank had argued that the Environment and Land Court lacked jurisdiction over the contractual dispute.
The applicants maintained that the dispute fundamentally concerned land sale, transfer and interests in property.
Justice Mbogo agreed, allowing the substantive case to proceed before the Environment and Land Court.
That ruling removed another procedural obstacle confronting Pirbhai and Tranquility Holdings.
However, neither ruling has determined whether the buyers are ultimately entitled to the property.
Nor has the court decided whether Middle East Bank was entitled to retain their KSh19.5 million deposit.
Those questions remain central to the substantive proceedings awaiting determination.
The September ruling therefore delivers protection without determining ownership or contractual entitlement.
Pirbhai and Tranquility Holdings cannot yet compel Middle East Bank to transfer the property.
But Middle East Bank equally cannot sell, transfer, lease, or charge the disputed property pending trial.
The court has effectively preserved the battlefield before the final contractual contest begins.
At its centre lies one question: did the 2023 auction create a binding sale that remained enforceable?
Alternatively, did the buyers’ subsequent conduct lawfully terminate the transaction and justify forfeiture?
The answer could determine both the property’s eventual ownership and the fate of the KSh19.5 million deposit.
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For now, the court has chosen preservation rather than premature finality.
The KSh195 million property must remain untouched until the substantive dispute is finally determined.
And the KSh19.5 million deposit remains locked inside the wider contractual battle.
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