The High Court has stopped the Nakumatt Holdings suit proceedings after it received an order from the Court of Appeal.
Justice Joseph Onguto granted the application after Garden City Retail Limited applied to be enjoined in the matter as one of the creditors.
Last week, Justice Onguto defied the orders and gave a ruling on Nakumatt operating under administration where he rejected their application.
He said he defied the order citing errors in the names of the judge bench hearing the Garden City suit.
“However the matter has been set aside until the hearing and determination of the suit filed at the Court of Appeal,” the judge said.
Garden City Retail Limited made the application after it felt dissatisfied with the decision of Justice Onguto who had dismissed their application.
Garden City asked to be allowed to join the case, following an earlier advertisement in the dailies asking any creditors of Nakumatt to file their responses before the hearing. But Onguto said GC Retailers did not file the notice on time.
This was after the troubled retailer, through lawyer Kamau Karuri, applied for an administration order in the same court last month, proposing the appointment of Peter Kahi of PKF Consulting Limited as an independent administrator to perform his functions in the interests of its creditors. Karuri said if the company is put under an administrator, it will be able to come back on its feet and pay its creditors.
“To benefit from liquidation will only be the secured creditors, as opposed to unsecured creditors. We want a solution which will benefit all the creditors alike,” he said.
The court heard that Tuskys Supermarkets seeks to buy shares from Nakumatt and negotiations are at advanced stages. The Nakumatt lawyer said the firm has chosen to have details of the consultations remain private and confidential until they are done.