Woman risks losing 305-acre farm after defaulting on Sh10m loan

A farmer in Uasin Gishu County risks losing a 305-acre land after she defaulted on Sh10m loan she took 20 years ago from the Agricultural Finance Corporation. The loan has grown into a Sh340 million debt. PHOTO | FILE | NATION MEDIA GROUP

What you need to know:

  • Should Mrs Mary Juster Chepleting fail to pay, her properties will be auctioned, a court ordered on Wednesday.
  • Mrs Chepleting had asked the court to stop the corporation from auctioning her property to recover the accumulated debt of Sh339,275,195.
  • Mrs Chepleting took the Sh10 million loan to develop her 305 acre-land in Uasin Gishu County.

A farmer in Eldoret has been ordered to pay over Sh300 million for defaulting on a loan of Sh10 million given by the Agricultural Finance Corporation 20 years ago.

Should Mrs Mary Juster Chepleting fail to pay, her properties will be auctioned, a court ordered on Wednesday.

Mrs Chepleting had asked the court to stop the corporation from auctioning her property to recover the accumulated debt of Sh339,275,195.

But Judge Antony Ombwayo said that Mrs Chepleting failed to show that she repaid even a single cent.

The outstanding loan balance has now far outstripping the money she borrowed.

“The act of issuing cheques that bounced was in bad faith and not acceptable for a person who requires the court to exercise its discretion to her favour.

“Moreover, the amount lent was from the Treasury 20 years ago and therefore failure to repay is a great loss of public funds,” ruled Judge Ombwayo.

He said she should have demonstrated that she has been repaying.

Mrs Chepleting took the Sh10 million loan to develop her 305 acre-land in Uasin Gishu County.

She said that she has repaid a substantial part of the loan.

However, on or about March 3, 2015, Legacy Auctioneers served her with a notice and advertised the land for sale, in fragrant disregarded of legal process, she argued.

Mrs Chepleting said the corporation’s claim of Sh339,275,195 for a loan of Sh10 million was unconscionable and also illegal.

The corporation said they lent Mrs Chepleting Sh10,100,000 in June 5, 1996 for land purchase and development.

The sum was broken down as follows: Sh7,800,000 for purchase of land; Sh1,720,00 for purchase of Ford Tractor mode 5640 4WD and Sh580,000 for farm implements.

The sum was to be repaid in full with interest at the rate of 20 per cent per annum with a cumulative period of 10 years.

Also on or about March 14, 1997, Mrs Chepleting applied for and received a further agricultural loan of Sh5,893,950 which was to be paid with interest until payment in full at the rate of 20 per cent per annum within a cumulative period of 3 years.