High Court proceedings reveal complex lease dispute involving billionaire tenant and property owners over Kilimani commercial building
A protracted legal battle involving city billionaire Chris Obure and the owners of Senteu Plaza in Kilimani has taken a dramatic turn, with revelations that the businessman paid Sh981 million in rent before being evicted from the commercial property in May this year.
The dispute, which centers on a six-year lease agreement signed in September 2017, has exposed the intricate details of what was intended to be a rent-to-own arrangement worth over Sh1.3 billion.
The Disputed Eviction
Appearing before Justice Charles Kariuki, property owner Pankaj Chahhaganlal Shah was questioned about the circumstances surrounding the eviction of SBS Dunhill Group Limited, the company owned by Chris Obure, from Senteu Plaza on May 16, 2025.
Shah acknowledged receiving the substantial rent payment of Sh981 million arising from the lease agreement that was set to run from September 2017 to September 2023. However, he defended the eviction, claiming it was carried out pursuant to a court order.
“The tenant is not in the lease building. Through my lawyer we got orders for them to vacate. I don’t know that the orders were stayed and the case is still ongoing,” Shah told the court.
Under rigorous cross-examination by Obure’s lawyer Muthoni Nkonge, Shah admitted that the eviction orders were contested in court, raising questions about the legitimacy of the tenant’s removal from the premises.
The Original Agreement
The court heard that Senteu Plaza is owned by four brothers: Ajeetkumar Chhaganlal (deceased), Chandulal Chhaganilal Shah (deceased), Pankaj Chhaganlal Shah, and Kamalkumar Chhaganlal Shah.
The brothers initially entered into an agreement with SBS Dunhill Limited to sublet their premises for six years at a consideration of Sh160 million. However, the arrangement included a crucial provision that would have allowed SBS to purchase the property for Sh1.3 billion after the lease period expired.
According to Obure’s testimony, the arrangement was conditional on significant investment commitments. “It was resolved at the said meeting that the prospective Landlord(s) be informed that the Applicant’s International Board of Directors would only take up space in their building and invest close to USD Ten Million (say USD 10,000,000.00) therein if they agree in good faith that they would sell the building to the Applicant at the expiry of the anticipated six-year Lease term,” he told the court.
Complications and Deaths
The case has been complicated by the deaths of two key signatories to the original lease agreement. Ajeetkumar Chahaganlal and Chandulal Chhaganlal Shah, who signed the lease with SBS, died in 2018 and 2022 respectively.
Significantly, Pankaj Shah, the surviving brother who appeared in court, never signed any lease agreement with SBS Dunhill Limited, a fact that could have legal implications for the dispute.
Conflicting Claims
The parties present starkly different versions of events. SBS Dunhill Limited claims it was irregularly evicted after paying in excess of Sh1 billion toward the acquisition of the property. The company argues that the substantial payments were made with the understanding that they would eventually own the building.
However, Pankaj Shah denied receiving any money toward the purchase of the property. Instead, he claimed that at the time of eviction, SBS was in rent arrears of Sh10 million.
“The tenant had indicated in a letter that he was in rent arrears and he was looking for money to offset the rent arrears. The money was not paid,” Shah stated.
Legal Implications
The case highlights the complexities that can arise in commercial lease agreements, particularly those involving substantial sums and purchase options. The death of key signatories has added another layer of complexity to an already intricate legal dispute.
The contradiction between the tenant’s claim of having paid over Sh1 billion and the landlord’s assertion of receiving money only for rent payments suggests that the court will need to carefully examine the nature and purpose of the payments made.
Next Steps
Justice Kariuki has scheduled the matter for mention in October to confirm compliance with submissions and fix a judgment date. The outcome of this case could have significant implications for commercial lease agreements in Kenya, particularly those involving substantial investment commitments and purchase options.
The dispute serves as a cautionary tale about the importance of clear documentation in commercial property transactions and the potential complications that can arise when key parties to an agreement pass away before its completion.
As the legal proceedings continue, both parties will need to present compelling evidence to support their respective positions on what appears to be a fundamental disagreement about the nature and terms of their commercial relationship.
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