[2021] KEBPRT 146 (KLR)

REPUBLIC OF KENYA

IN THE BUSINESS PREMISES RENT TRIBUNAL AT NAIROBI

TRIBUNAL CASE NO. 72 OF 2019 (KISII)

ABDIRAHAMAN SIYAT SALAT..........................................LANDLORD/RESPONDENT

-VERSUS-

FARAH ALI BARE............................................................................TENANT/APPLICANT

RULING

This matter coming up for ruling on the notice of motion application dated 27th February 2020 filed by the Tenant/Applicant and accompanied by a supporting affidavit sworn by Farah Ali Bare on the even date.

Parties and Their Representatives

1. The Tenant/Applicant, Farah Ali Bare(hereinafter the “Tenant”) has been in occupation of the premises belonging to the Landlord/Tenant referred to as Plot No. 1697 Rongo-Kamagambo/ Kabuoro (hereinafter the “suit premises) since the year 2016.

2. The Firm of Agure Odero & Company Advocates is on record for the Tenant.

3. The Landlord/Respondent, Abdirahaman Siyat Salat(hereinafter the “Landlord”) is the registered owner and Landlord of the Premises referred to as Plot No. 1697 Rongo-Kamagambo/Kabuoro rented out to the Tenant/Applicant.

4. The Firm of Ondieki Orang’i & Company Associates is on record for the Landlord.

The Background of the Dispute

5. It is not in dispute that in the year 2016, the Landlord and the Tenant entered into Tenancy Agreement in which the Tenant occupied the suit premises and paid monthly rent of Kshs. 100,000. 00. The Tenant occupied premises peacefully until the year 2019.

6. On 31st May 2019, the Landlord duly served the Tenant with a Notice to terminate the Tenancy in line with Section 4 (2) of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, CAP 301 Laws of Kenya,which notice was to take effect on1st August 2019.

7. The grounds for termination of the tenancy were that the Tenant had defaulted in payment of rent for a period of 16months prior to the issuance of the notice, and which default amounted to arrears of Kenya shillings two million, three hundred and ninety-one thousand (Kshs. 2,391,000. 00).

8. Subsequently and upon expiry of the notice period to the Tenant, the Landlord filed a reference dated 16th August 2019, before this Honorable Court seeking for orders inter alia: that this Honourable Court be pleased to authorize the Landlord to proceed and evict the Tenant from the suit premises, as the notice period had lapsed and the Tenant had not filed any Reference against the Landlord’s notice to this Honourable Court.

9. On 11th October 2019, the matter came up for hearing and my brother Hon Mbichi as he then was the Chairman, issued the following orders:

i.THAT the Landlord be and is hereby allowed to levy distress and recover outstanding arrears of Kenya shillings two million, three hundred and ninety-one thousand(Kshs. 2,391,000. 00).

ii.THATthe Landlord be and is hereby allowed to evict the tenant from the suit premises and later take possession of the same in the presence of the OCS Rongo Police Station

iii.THATthe Tenant/Respondent shall pay the landlord application cost assessed to Kenya shillings fifty thousand(Kshs.50,000. 00).

iv.THATpayment of further court fees is waived in the circumstance of the case.

v.THAT the Tenant shall pay auctioneer charges.

vi.THAT the OCS Rongo Police Station shall ensure compliance.

10. Subsequently, vide a notice of motion applicationfiled by the Tenant on 27th February 2020, and accompanied by a supporting affidavit sworn by the Tenant, Farah Ali Bare,on the even date, the Tenant sought the following orders

i) THAT the application be heard at the 1st instance.

ii) THAT this Honourable Court be pleased to order for stay of execution by the Landlord, pending hearing of this application inter partes.

iii) THAT upon granting the prayer No. 2 above, this court be pleased to review its order dated 11th October 2019 and set aside the subsequent orders thereof, to allow taking of accounts of the whole rent paid by the Applicant against the Respondents receipt thereof.

iv) THAT there be an order to set aside the matter, and the case to be heard afresh as there was apparent error on the face of records.

v) Costs of the application.

11. The application came up for hearing on 2nd March 2020 and this Honourable Court certified the Application urgent and the Tenant directed to serve the Respondent for inter partes hearing.

12. The matter was mentioned on 12th April 2021, 19th August 2021 and 15th September 2021. However, there was no appearance by the Landlord or his counsel despite proof of service being tendered in Court by Counsel for the Tenant. Consequently, the parties were directed to file and serve written submissions and the matter was scheduled for Ruling on 21st October 2021.

Jurisdiction

13. The Jurisdiction of this Tribunal is not in dispute.

Issues for Determination

14. Having considered the parties’ pleadings, affidavits and submissions and having considered the relevant legal framework, the following are the main issues that fall for determination before this Honourable Court:

I. Whether the Tenant has made out a case to justify the review and setting aside of orders issued by this Honourable Court on 11th October 2019.

II. Whether this Honourable Court has the power to order stay of execution by the Landlord pending hearing and determination of issues raised in the Tenant’s Application dated 27th February 2020.

Parties’ Submissions

15. Counsel for the Tenant filed written submissions dated 23rd March 2021. Counsel submitted that after assessing the Tenant’s records, the Tenant had paid rent in excess to the tune of Kshs. 3,000,000. 00 and that the Landlord owed the Tenant the amount paid in excess. The Tenant annexed Bank Statements and Mpesa records as evidence of payment of rent to the Landlord.

16. It was the Tenant’s further submission that there was need to take proper accounts of the total amount paid by the Tenant during the period of the Tenancy, and that the matter should be re-opened to allow new evidence, and to enable the Tenant file a counterclaim for a claim of Kshs. 3,000,000. 00 against the Landlord.

17. Lastly, the Tenant claims there was an error apparent on the face of record and which warrants the setting aside of all the consequential orders issued by this Honourable Court.

18. This Honourable Court did not have the benefit of the Landlord’s response to the Tenant’s Application nor submissions from Counsel, despite evidence from the Tenant’s Counsel indicating that the Landlord had been duly served with the application.

Analysis and Determination

I. Whether the Tenant has made out a case to justify the review and setting aside of orders issued by this Honourable Court on 11th October 2019?

19. It is clear that in exercising the powers conferred under the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, this Honourable Court must restrict itself to the powers conferred to it underSection 12 of the said Act.

20. Section 12 of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Actclearly stipulates as follows:

12. A Tribunal shall, in relation to its area of jurisdiction have power to do all things which it is required or empowered to do by or under the provisions of this Act, and in addition to and without prejudice to the generality of the foregoing shall have power—

(i)to vary or rescind any order made by the Tribunal under the provisions of this Act;

21. This power of the Tribunal was elaborated by the High Court in the case of Spares Corner (K) Ltd. Vs Maram Noormohamed, Abdul Hamid Noormohamed,Ismael Noormohamed[2003] eKLR,in which the Tenant sought for review of a decision issued by this Tribunal, after the Tenant had been evicted from the suit property and the Tenancy relationship between the parties severed. The High Court in affirming the power of this Tribunal to vary or rescind its orders as provided under Section 12 (i) of the Act, and in remitting the matter back to the Tribunal for consideration on merit despite the execution of earlier orders stated as follows:

“It is difficult to see under what circumstances a Tribunal would be asked to vary or rescind any order made under the Act if it cannot reconsider its own orders dismissing a reference and ordering a tenant’s eviction. The Act provides for it and it is in any event a fundamental principle of Justice.”

22. Based on the foregoing, it is therefore clear that this Honourable Court has the power to review or vary or rescind earlier orders issued by it. Subsequently, this raises the question on what grounds or under what circumstances is this Honourable Court required to consider an application to vary or rescind its earlier orders?

23. In response to the above question, I stand guided by the decision in the case of Transallied Limited v Sakai Trading Limited [2016] eKLR, where the Environment and Land Court addressed its mind on the grounds that should guide this Court in exercising its review powers as follows:

“The appeal before us is against the decision of the tribunal that was made on 1st July 2011 by which the tribunal declined to review its order made on 3rd September 2010 striking out the Appellant’s complaint for want of jurisdiction. What we have been called upon to determine is whether the tribunal acted correctly in rejecting the Appellant’s application for review. Section 12(1) (i) of the Act gives the tribunal power to vary or rescind any of its orders. The Act does not provide for the circumstances under which the tribunal can exercise that power…We are of the view that the provisions of the Civil Procedure Act and the rules made thereunder would apply to the proceedings before the tribunal unless expressly stated otherwise in the Act and the regulations made thereunder which we have referred to above…What we are to determine is whether the Appellant’s application for review before the tribunal met the threshold set out under Order 45 Rule 1(1) of the Civil Procedure Rules.”

24. The grounds in which a Court may exercise its power of review are clearly stated under Order 45 rule 1(1) of the Civil Procedure Rules. The said provision provides as follows:

“any person considering himself aggrieved by a decree or order from which an appeal is allowed but from which no appeal has been preferred or by a decree or order which no appeal is allowed and who from the discovery of new and important matter or evidence which after the exercise of due diligence was not within his knowledge or could not be produced by him at the time when the decree was passed or the order madeor on account of some mistake or errors apparent on the face of the record or for any other sufficient reason desires to obtain a review of the decree or order may apply for a review of judgment to the court which passed the decree or made the order without unreasonable delay.”

25. Therefore, in order for the Tenant herein to succeed in this application, he must satisfy either of the conditions stipulated in Order 45 Rule 1 of the Civil Procedure Rules which are:

a) Discovery of a new and important matter or evidence which, after the exercise of due diligence was not within his knowledge or could not be produced by him at the time when the decree was passed or the order made;

b) A mistake or error apparent on the face of the record; and

c) Any other sufficient reason.

26. In addition to the above grounds, the law further requires that an application for review of orders must be made by the Applicant without unreasonable delay.

27. With this background in mind, I shall proceed to analyse whether the Tenant herein has met the threshold to warrant review of the orders issued by this Honourable Tribunal on 11th October 2019.

Discovery of new and important matter

28. The Tenant has disputed that he was indebted to the Landlord and instead claims that he had paid his rent in excess. In support of this, the Tenant has annexed several Mpesa records and bank statements marked as annexures “FAB2”and“FAB3” in the affidavit sworn by the Tenant as evidence of payment of rent to the Landlord.

29. In addition to the new evidence, the Tenant has further raised a claim in paragraph 5(ii) of the Application which states as follows:

“THAT after assessing the Applicants records, it’s the Applicant who has paid excess of over Kshs. 3,000,000. 00 against Kshs. 2,391,000. 00 as claimed by the Respondent.”

30. The Tenant further alleges in paragraphs 8 and 9 of the supporting affidavit that the issue of rent between the parties was not fully settled as considering the rent rates in Rongo, the suit premises were to attract monthly rent of Kshs. 30,000. 00 per month as opposed to Kshs. 100,000. 00 per month, which the Tenant paid until the time of institution of this suit.

31. From the record before this Honourable Court, I note that the Mpesa records and the bank statements produced by the Tenant as annexures to the Application had not been tendered in this Court prior to the orders issued on 11th October 2019, and as such, this Honourable Court did not have the benefit of considering the same. The Mpesa and bank statements therefore constitute new and important matter within the meaning of Order 45 Rule I (b) of the Civil Procedure Rules, 2010.

32. However, the element of discovery of new matter imposes a condition that the new matter produced should be such that even after exercise of due diligence, the information was not within the knowledge of the Applicant or that the same could not be produced by him at the time when the decree was passed or the order issued.

33. In the present case, the Tenant has not given any justification to show that the Bank Statements and Mpesa records were not within his knowledge or that he was not in a position to produce them at the earliest opportunity, apart from the explanation given in paragraph 2 of the Tenant’s supporting affidavit dated 27th February 2020, wherein the Tenant avers that his former Counsel failed to highlight several crucial information before this Honourable Tribunal.

34. Notwithstanding the above, I find that the evidence tendered by the Tenant in this Application is important and relevant as it touches on the core issues in dispute in this matter. The evidence may therefore be useful in aiding this Honourable Court to determine whether indeed the Tenant had defaulted in payment of rent, thus necessitating the Landlord to issue the notice to terminate the Tenancy, and subsequently proceeding to distress for rent by confiscating the Tenant’s goods.

35. In addition, Section 3 (3) of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, which is coached in mandatory terms, requires the Landlord to keep a record of all the rent paid in respect of rented premises, as follows

“The Landlord of a controlled Tenancy shall keep a rent book in the prescribed form of which he shall provide a copy for the Tenant and in which shall be maintained a record authenticated in the prescribed manner, of the particulars of the parties to the tenancy, the premises comprised therein and the details of all payments of rent and all the repairs carried out to the premises.”

36. From the records before this Honourable Court, it is clear that the Landlord did not tender any statements of account relating to the payment of rent or default thereof by the Tenant in support of the Landlord’s reference dated 16th August 2019. To this end, this Honourable Court did not have the benefit of analyzing the Landlord’s statement of accounts.

37. It is a principle of common law that no man shall be condemned unheard. In this regard, it in the interest of justice and equity that the Landlord herein be required to produce statements of account or the rent book as required by the Act, in response to the Mpesa records and bank statements produced by the Tenant to enable this Honourable Court to fully determine the issue of disputed rent between the parties.

38. On this basis, I find that the Tenant has satisfied the requirement of discovery of new and important matter, as a ground for review of the earlier Orders of this Honourable Court.

Application be made without unreasonable delay.

39. The Tenant filed this present application seeking review of the Orders given by this Honourable Court on 11th October 2019, on 27th February 2020, which was four months since the orders were issued.

40. In exercising my discretion, and in considering the supporting affidavit sworn by the Tenant and the annexures thereto, I find the four months’ period reasonable and as such, the Tenant did not delay unreasonably in filing this present application.

II. Whether this Honourable Court has the power to order stay of execution by the Landlord pending hearing and determination of issues raised in the Tenant’s Application dated 27th February 2020?

41. Vide the orders of this Honourable Court issued on 11th October 2019, the Court authorized the Landlord to levy distress for rent and recover the arrears and further, to evict the Tenant from the suit premises. The Tenant has indeed confirmed that on 12th October 2019, the Landlord proceeded to execute the aforementioned orders by confiscating the Tenant’s goods whose value was worth Kshs. 4,000,000. 00.

42. On this basis, since execution was already undertaken by the Landlord two years ago, there is a possibility that the Landlord proceeded to dispose of the proclaimed goods and as such, this Honourable Court cannot order the Landlord to return the goods to the Tenant.

43. However, the Tenant has a recourse in law as this Honourable Court is empowered under Section 13 of the Act to order that the Tenant be compensated for the damage or loss suffered, in the event that the determination by this Honourable Court is found to have been unjust and prejudicial to the Tenant. The said section provides that:

“Where a Tribunal makes any order in respect of a tenancy under this Act and it is subsequently made to appear to the Tribunal that it was induced to make the order by the misrepresentation or the concealment of material facts by either party, the Tribunal may order the offending party to pay to the other party such sum as appears sufficient as compensation for the damage or loss suffered by such other party as a result of such order.”

44. It is therefore my finding that since the order of stay of execution sought by the Tenant has been overtaken by events, this Honourable Court cannot grant the same. This is in addition to the fact that the Tenant may be compensated in the form of damages in the event that the execution was improper and irregular.

45. From my above analysis, I am satisfied that the Tenant has raised very pertinent issues, which ought to be considered and determined by this Honourable Court on merit in order to meet the ends of justice. The Tenant has therefore satisfied the conditions for grant of the review orders in line with Section 80 of the Civil Procedure Act as read with Order 4 Rule 1 of the Civil Procedure Rules.

46. In the upshot, I allow the Tenant’s Application dated 27th February 2020 in the following terms:

i. The orders issued by this Honourable Court on 11th October 2019 together with all consequential orders be and are hereby set aside.

ii. The Landlord is hereby ordered to produce before this Honourable Court the statement of accounts and/or records of payment of rent to the suit premises by the Tenant during the period of the Tenancy within 30 days from the date hereof. Tenant to do the same within 30 days.

iii. The reference to be set down for hearing in 90 days.

iv. The costs of this suit shall be in the cause.

HON A. MUMA

VICE CHAIR

BUSINESS PREMISES RENT TRIBUNAL

RULING DATED, SIGNED AND DELIVERED VIRTUALLY BY HON A. MUMA THIS 12TH DAY OF NOVEMBER, 2021 in the absence of the parties.

HON A. MUMA

VICE CHAIR

BUSINESS PREMISES RENT TRIBUNAL