Cape Holdings has suffered a major setback in its fight to save Nairobi’s landmark 14 Riverside property which hosts DusitD2 Hotel after the Court of Appeal declined to temporarily stop a looming public auction tied to a KSh10.7 billion commercial dispute.

The decision means the high profile property remains on course for auction on May 26 after judges rejected Cape Holdings’ bid for interim orders pending a substantive ruling later this year, escalating pressure in a case that has stretched across Kenya’s courts for more than a decade.

The dispute stems from a 2010 property deal in which Synergy agreed to purchase part of the 14 Riverside development before later terminating the agreement and seeking a refund of funds already paid.

The fallout escalated into arbitration, where an award in 2015 directed Cape Holdings to pay approximately KSh1.66 billion, including 18 per cent annual compound interest , a figure that Cape says has since ballooned to about KSh10.7 billion.

Cape Holdings argues that the award has grown disproportionately over time and could now result in the sale of the entire 14 Riverside complex , including six blocks and a parking silo, despite the original dispute centering on a single block transaction. The company has unsuccessfully challenged the arbitral award through the High Court, Court of Appeal and Supreme Court over the past decade.

In reaction to the Court of Appeal’s refusal to issue interim relief, Cape Holdings signaled it would continue pursuing legal remedies.

“Today’s decision is not the end of the road for Cape Holdings. The decision not to grant an injunction is disappointing, but it does not resolve the fundamental question at the heart of this matter. While we acknowledge our legal obligations, the sum being enforced raises serious questions of proportionality and fairness that no court has ever determined on the merits. We will be pursuing all our rights to receive the proper judicial scrutiny that these issues deserve,” stated the company.

The company maintains that key questions surrounding the fairness of the award,  particularly the long-running compound interest , have never been substantively examined by the courts, even as enforcement proceedings intensify.

Unless halted, the public auction of 14 Riverside is expected to proceed on May 26, marking a dramatic chapter in one of Kenya’s longest-running commercial disputes.