Baringo United Company Ltd v Muhia & another (Environment and Land Appeal E011 of 2025) [2026] KEELC 4409 (KLR) (14 July 2026) (Judgment)

Baringo United Company Ltd v Muhia & another (Environment and Land Appeal E011 of 2025) [2026] KEELC 4409 (KLR) (14 July 2026) (Judgment) Neutral citation: [2026] KEELC 4409 (KLR) Republic of Kenya In the Environment and Land Court at Nakuru Environment and Land Appeal E011 of 2025 MAO Odeny, J July 14, 2026 Between Baringo United Company Limited Appellant and Isaac Kuria Muhia 1st Respondent Bina Wholesalers 2nd Respondent (Being an appeal from the judgment/decree of Business Premises Tribunal at Nakuru by Hon. Gakuhi Chege- Panel Chairperson and Joyce Osodo-Member delivered on 28th February, 2025 in Nakuru Business Premise Tribunal Case No. E205 of 2023 Consolidated with Nakuru BPRT No. E217 of 2023) Judgment 1.This appeal arises from a judgment delivered on 28th February, 2025, in Nakuru Business Premises Tribunal Case No E205 of 2023, Consolidated with Nakuru BPRT No. E217 of 2023. The Appellant being, aggrieved by the said judgment, lodged a Memorandum of Appeal dated 20th March, 2025, and listed the following grounds:1.The Learned Chairperson of the Panel and Member of the Tribunal erred in law and in fact in failing to appreciate and properly evaluate the evidence adduced thereby rendering a Judgment that is unsound in principle and not a reflection of the evidence on record.2.The Learned Chairperson and Member of the Tribunal erred in law and in principle in holding that structural details of the construction and geotechnical report were not provided to the Tribunal and failing to appreciate that the same were only to be provided to the County Government of Nakuru as per the approval plan just before construction begins and which construction can only happen upon the Appellant obtaining possession of the premises.3.The Learned Chairperson and Member of the Tribunal erred in law and in principle in failing to appreciate that the termination Notice issued to the Respondent was aimed at meeting the conditions set out in the approval plans to enable construction begin.4.The Learned Chairperson and Member of the Tribunal erred in law and in fact in failing to consider and appreciate that the approval plans exhibited by the Appellant was indeed proof of intention to terminate the Tenancy to achieve and fulfil the reasons enumerated in the termination Notice issued.5.The Learned Chairperson and Member of the Tribunal erred in law and in principle and in raising the standard of proof and/or threshold required of the Appellant to prove resolution to demolish their old building and Construct a new one and disregarding the Appellant’s Constitutional right to own and enjoy their property.6.The Learned Chairperson and Member of the Tribunal erred in law and in fact finding that the Appellant did not have the requisite funds to undertake such a project by virtue of engaging Phelma Ventures on “Build Operate and Transfer Basis” failing to appreciate that was not a ground under Section 7 of CAP 301 Laws of Kenya.7.The Learned Chairperson and Member of the Tribunal erred in law and in fact in holding that the Appellant did not have the intention to undertake the project ignoring the evidentiary and legal material presented before the tribunal.8.The Tribunal misdirected itself by holding that the Appellant entered into fresh tenancies for vacant premises within the same building a year upon resolution to demolish without support of any evidential material and contradicting his earlier that there was no resolution to demolish the building.9.The Tribunal erred in law and in fact in failing to appreciate the law that allows a Landlord and/or a Tenant during pendency of their Tenancy to terminate their relationship upon issuing a proper Notice to the other, Landlord’s resolution and/or Tenancies notwithstanding.10.The Tribunal erred in law and in principle while interpreting the principle enunciated in the case of Auto- Engineering Ltd vs Gonella & Co. Ltd (1978) eKLR by the Respondent and thus arriving at a biased decision11.The Tribunal erred in law and in fact by ignoring the submissions by the Appellants and relying heavily on the submissions of the Respondent’s Advocate and showing outright bias.12.The Tribunal failed to grasp the relevant jurisprudence and material placed before them and ignored the Appellants case. 2.A brief background to this appeal is that the Appellant with the intention of repossessing its premises known as Nakuru Municipality Block 5/114 and for the purposes of demolishing the buildings therein and re-constructing a new building thereon issued termination notices to its Tenants/Respondents that was to take effect on 1st January, 2024. 3.The 1st Respondent opposed the Notice of Termination of tenancy and filed a reference before the Business Premise Tribunal dated 24th November 2023. The matter was heard and by a Judgment delivered on 28th February 2025, Hon. Gakuhi Chege -Panel Chairperson and Hon. Joyce Akinyi Osodo – Member entered judgement for the Respondent as against the Appellant as follows:a.The 1st Tenant’s reference dated 24th November 2023, is allowed and the Notice of termination of Tenancy dated 26th October 2023, is hereby disapproved.b.The Landlord shall not issue any other notice based on the same grounds in the next Twelve (12) Months in line with Section 9(3) of Cap 301, Laws of Kenya.c.The 2nd Tenant’s Complaint dated 7th December 2023, is truck out with costs to the Landlord for being offensive to the doctrine of Res subjudice in view of NAKURU CMEL CASE NO. E196 OF 2021 in which it was the 1st defendant.d.The landlord costs against the 2nd Tenant is assessed at Kshs. 50,000/=e.The landlord shall pay costs of Kshs. 50,000/= to the 1st Tenant which shall be defrayed against the rent account. 4.The Appellant being dissatisfied with the Judgment filed the current appeal. Appellant’s Submissions 5.Counsel for the Appellant identified the following issues for determination:a.Whether the Termination Notice was adequate and valid?b.Whether the Judgment of the Tribunal was against the weight of the evidence tendered?c.Whether the Tribunal raised the standard of proof required of the Appellant to prove intention to terminate the tenancy?d.Whether the Tribunal misdirected itself in the Application of the principle and stare decisis in the case of Auto Engineering Ltd vs Gonella & Co. ltd (1978) eKLR. and hence arrived at a judgment that is unsound in principle and biased?e.Whether the Appeal has merit or not? 6.On the first issue, as to whether the Termination Notice was adequate and valid, counsel submitted that the tribunal in paragraph 28 of its judgment as seen on page 128 of the record of appeal held that the termination Notice that was served upon the 1st Respondent herein was in tandem with the legal provisions. Counsel further submitted that Appellant has no issue with the Tribunal’s finding on the adequacy and validity of the Termination Notice. 7.On the second issue, as to whether the Judgment of the Tribunal was against the weight of the evidence tendered, counsel submitted that the Business Premises and Rent Tribunal (BPRT) failed to properly evaluate the totality of evidence on record before rendering its Judgment. 8.Mr. Kiptoon further submitted that the Tribunal would have noted that the approval plans were subject to renewal upon expiry which renewal was actually acquired vide application number NKR-BP-RNW-AAA057. He submitted that there was evidence of renewal presented which the court did not factor in and therefore reached a wrong finding. 9.It was counsel’s submission that the Tribunal erred in finding that the extract of the minutes, Min 5/2/2024, was not a resolution to demolish and reconstruct the said building, and therefore failed to appreciate that the Minute item was a follow- up of the Appellant’s resolution that had been passed earlier in 2014. 10.According to counsel, the Tribunal’s finding that there was no resolution to demolish the building and build a new one was not a reflection of the evidence on record. Further, there was no evidence tendered to prove that the Appellant entered into fresh tenancies with other tenants. Counsel also argued that the Tribunal’s finding that the landlord gave the 1st Respondent the premises in 2015, after the resolution to demolish the building and construct was not supported by any evidence. 11.Mr. Kiptoon referred the court to paragraph 35 of the Tribunal’s judgment, page 129 of the record of appeal, where the Tribunal referred to Min. 3/1/2014 and concluded based on the Appellant’s resolution to engage Phelma Ventures to Build Operate and Transfer, that the Appellant did not have requisite funds to undertake such a major project. Counsel submitted that this was an admission by the Tribunal that there was a resolution to demolish the building, which contradicts the Tribunal’s earlier finding that there was no resolution to demolish the property. 12.On the third issue, as to whether the Tribunal raised the standard of proof required of the Appellant to prove intention to terminate the tenancy, counsel relied on the case of Lilian Wangari Ndegwa V Encarte & Rapid (E&R) Group Limited [2026] KEHC 1426 (KLR) and submitted that the Tribunal rightly pointed out that the landlord was obligated to provide evidence on a balance of probabilities that it intended to do what is stated in the tenancy notice. 13.Counsel further stated that the Appellant presented building plans approval dated 21st July 2016, payment receipt for renewal of expired plans to prove intention and an extract of the Appellant’s Board of Directors minutes of the resolution made in 2014, to demolish and reconstruct the building in the suit premises. The Appellant therefore discharged its burden of proof in this matter on a balance of probabilities before the Tribunal, and relied on the case of Kimani & 2 Others V Mungai [2025] KEBPRT 287 (KLR). 14.It was counsel’s submission that the Tribunal erred when it took issue with a non-production of the structural details of the construction and the Geotechnical report before it, as contained in the Approval plan and treated that as failure to demonstrate intention. Counsel relied on the case of Auto Engineering Ltd V M. Gonella & Co. Ltd (1978) eKLR and submitted that the Tribunal’s demand for detailed reports in the approval plan to ascertain intent amounted to raising the standard of proof beyond reasonable doubt a degree not applicable in civil cases. 15.Mr. Kiptoon further submitted that the idea of the Appellant to have Phelma Ventures undertake the project on their behalf was proof enough that they intended to carry on their project in that manner and it did not necessarily require them to prove availability of funds in their possession. 16.On the issue as to whether the Tribunal misdirected itself in the application of the principle of stare decisis in the case of Auto Engineering Ltd vs Gonella & Co. ltd (1978) eKLR, and hence arrived at a judgment that is unsound in principle and biased, counsel submitted that the Tribunal did not sufficiently consider the evidence presented by the Appellant to determine whether the intention was apparently deduced from the documents presented and the testimony of the Appellant’s Chairman. 17.Mr. Kiptoon argued that the Tribunal ignored several other guiding principles that were set out in the case, as it ignored the principle that the court, Tribunal could not decide what a planning authority or Minister would decide as it did not have advice or reports of inspectors with expert knowledge to enable it dig deep into professional reports. 18.On the final issue, as to whether the Appeal has merit, counsel submitted that the tribunal raised the standard of proof which required the Appellant to establish the case beyond the normal standard of a balance of probabilities which was an error in principle and urged the court to allow the Appeal as prayed. Respondent’s Submissions 19.Counsel for the Respondent filed submissions dated 9th March 2026, and submitted that the Tribunal’s decision was evidence-based and, correctly applied the legal principles that governed termination of a controlled tenancy on the ground of intended demolition and reconstruction under Section 7(1)(f) of Landlord and Tenant (Shops, Hotels and Catering Establishments) Act Cap 301. 20.Counsel relied on the case of Auto Engineering Ltd V Gonella & Co. Ltd (1978) eKLR (Supra), and submitted that the Appellant’s intention was neither firm nor settled. Counsel further stated that the alleged resolution to demolish was first mooted in 2014, but never acted upon for nearly a decade, indicating lack of immediate intention to undertake the work, contrary to the holding in Auto Engineering Ltd Case (supra). 21.Mr. Owuor submitted that the Appellant’s witness confirmed they had no current development permission from the County Government, a statutory prerequisite under Section 57(1) of the Physical and Land Use Planning Act. Further, the initial 24-month construction period for the 2016 approval lapsed in 2018 and was only renewed after the tenant challenged the termination notice, thus an afterthought. 22.According to counsel, from the Appellant’s minutes (MIN/4/2/2024), it evicted tenants from Borut House on the grounds of demolition and building of a modern high-rise building, only to later sub-divide and re-let the same premises. He argued that the said conduct showed an intention to obtain possession and not to reconstruct. 23.Counsel submitted that the court must be satisfied that the intention to demolish and reconstruct is genuine and not colorable, hence the Tribunal correctly required the Appellant to discharge the evidential burden placed upon it by Section 107 of the Evidence Act. That the Appellant, having alleged a genuine intention to demolish, was duty-bound to prove it with cogent evidence but failed to do so. 24.It was counsel’s submission that the Tribunal did not find the Notice invalid in form, but found that the grounds for termination under Section 7(1)(f) of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act Cap 301 had not been proved, and urged the court to dismiss the Appeal with costs. Analysis And Determination 25.The Appellant listed 12 grounds of Appeal in the Memorandum of Appeal, which the court condensed to two issues for determination as follows:a.Whether the members of the Tribunal erred in fact and in law in finding that, the Appellant had not proved the intention to terminate the tenancy?b.Whether the members of the Tribunal misdirected themselves in the application of the principle of stare decisis in the case of Auto Engineering Ltd vs Gonella & Co. ltd (1978) eKLR,c.Who should bear the costs of the appeal? 26.This is a first appeal and the court is cognizant of its primary role which is to re-evaluate, re-assess and reanalyze the extracts on the record and then determine whether the conclusions reached by the members of the Tribunal are to stand or not and give reasons either way as was held in the case of Abok James Odera t/a J. Odera & Associates v John Patrick Machira t/a Machira & Co Advocates [2013] eKLR. 27.Similarly, in the case of Okeno v Republic [1972] EA 32 at 36, the East Africa Court of Appeal stated the duty of the Court on a first appeal as follows:“An appellant on a first appeal is entitled to expect the evidence as a whole to be submitted to a fresh and exhaustive examination (Pandya v. R., [1957] E. A. 336) and to the appellate court's own decision on the evidence. The first appellate court must itself weigh conflicting evidence and draw its own conclusions. (Shantilal M. Ruwala v. R., [1957] E.A. 570). It is not the function of a first appellate court merely to scrutinize the evidence to see if there was some evidence to support the lower court's findings and conclusions; it must make its own findings and draw its own conclusions. Only then can it decide whether the magistrate's findings should be supported. In doing so, it should make allowance for the fact that the trial court has had the advantage of hearing and seeing the witnesses, see Peters v. Sunday Post, [1958] E. A. 424.” 28.It was further held in the Mwangi V Wambugu [1984] KLR 453, that an appellate court will not normally interfere with a finding of fact by the trial court unless such finding is based on no evidence or on a misapprehension of the evidence; or where the court has clearly failed on some material point to take account of particular circumstances or probabilities material to an estimate of the evidence. 29.The circumstances giving rise to this dispute, was a notice by the Appellant, to the Respondents to vacate the premises on the grounds that the Appellant intended to reconstruct the suit premises. The Appellant pursuant to Section 4(5) of Cap 301 issued a notice dated 26th June, 2019, which notice specifically stated that it wished to terminate the tenancy to demolish the old buildings and develop new and modern ones. 30.The Respondent in opposition to the notice moved the Tribunal vide a reference dated 24th November, 2023, pursuant to Section 6(1) of Cap 301 31.Section 7 of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, Chapter 301 Laws of Kenya Cap 301 provides for various instances in which a landlord may be allowed to terminate a tenancy. One of them is where the landlord intends to use the premises as provided under Section 7 (1) (f) as follows:“7.Grounds on which landlord may seek to terminate tenancy(1)Where under section 4 of this Act served a notice of termination of a controlled tenancy on the tenant, the grounds on which the landlord seeks to terminate such tenancy may be such of the following grounds as are stated in the aforesaid notice—(g)that on the termination of the tenancy the landlord intends to demolish or reconstruct the premises comprised in the tenancy, or a substantial part thereof, or to carry out substantial work of construction on such premises or part thereof, and that he could not reasonably do so without obtaining possession of such premises” 32.The Appellant could terminate a tenancy where it intended to conduct developments on the premises. The notice issued by the Appellant specified the intention to demolish the old buildings and construct a new structure, which is not disputed by either party. What is in dispute is that the Appellant did not establish the intention to demolish and reconstruct the premises. 33.In the case of Fisher v Taylors Furnishing Stores Ltd [1956] 2 All ER 78, it was held that:“There must, therefore, be an intention and it must be an intention which in point of time is related to the termination of the current tenancy. It seems to me that the intention must be to do one of the following things: (i) to demolish the premises comprised in the holding; or (ii) to reconstruct the premises comprised in the holding; or (iii) to demolish a substantial part of the premises comprised in the holding; or (iv) to reconstruct a substantial part of the premises comprised in the holding; or (v) to carry out substantial work of construction on the holding; or (vi) to carry out substantial work of construction on a part of the holding.If the landlord prove an intention to do one of those things, and to do it on the termination of the current tenancy, he must then prove that he could not reasonably do it without obtaining possession of the holding.” 34.The intention must be realistic and backed with evidence of approved structural and architectural plans, financial capacity to execute the construction, proof of capital, such as, attaching bank statements or construction financing. The Landlord must also prove that he/she has complied with the statutory requirements and approvals such as, licenses from the relevant statutory bodies. 35.In the case of Eldomart Holdings Limited V Ticket Company Limited [2019] KEELC 4412 (KLR), the court held as follows:“The legislature left no doubt that the Act was enacted for the purposes of protecting tenants. This court must have the said objective in mind while interpreting the Act. The burden was upon the Respondent to establish that they had an intention of occupying the suit premises for a period of not less than one year for the purposes of its own business. In the case of Auto Engineering v Gonella (1978) KLR 248, it was held that the onus is on the landlord to establish a firm and settled intention to occupy the premises held by a tenant.” 36.The main contention is whether the Tribunal erred in finding that, the Appellant had not established an intention to occupy the suit premises and developing it. In the case of Auto Engineering Ltd V M Gonella & Co Ltd [1978] KEHC 6 (KLR), the court held as follows:“..Thus, in Kenya, it is the existing tenancy which is extended to cover the tenant’s continuance in possession, as distinct from the grant of a new tenancy. We cannot, however, accept the argument that there is any distinction, so far as the burden of proof is concerned, on a landlord serving a notice to quit on one or more of several grounds under the Kenya Act, and opposing the grant of a new tenancy on one or more of similar grounds under the Landlord and Tenant Act 1954. All the authorities in England show that the burden of proof is on the landlord to establish his intention as a matter of fact, which is the position here.” [Emphasis mine] 37.The evidence before the Tribunal, shows that the Appellant produced approved building plans dated 21st July, 2016, which provided that the said construction was to be carried out within 24 months from the date of approval and subject to renewal upon expiry. There was an application for renewal issued to the Appellant on 20th May, 2024 (page 84 of the record of appeal), but the document was not a permit for development since the Appellant was to await receipt of the notification of development permission (Form DC8) which was not issued in this case. 38.It is also on record that the proposed developments never took place as required, and that the termination notices were issued to the Respondents almost 3 years later. It is further the case that the Appellant was required to provide the structural details of the construction together with a Geotechnical report for the project which he never availed. 39.It is trite that developments on controlled tenancies have to be guided by the original intent of the landlord to justify the vacation of the tenant from the premises. In the instant case, the approved building plans were issued to the Appellant with 15 conditions to be fulfilled before construction was to take place but the same were not fully met. 40.In the case of Tekimano Company Limited V James Wanjohi Gitahi & 4 others [2017] KEELC 175 (KLR), the court held as follows:“(i)No valid notices could have been issued without a resolution of the appellant for issuance of the notices. According to the evidence adduced before the Tribunal, the appellant had not passed a resolution authorizing the issuance of that notice. I agree with the submissions by the advocates for the tenants (respondents) that without a resolution by the appellant for issuance of the notices, the notices cannot be said to have been issued by the appellant. I also, agree with the learned Chairperson of the Tribunal, that the notices were a nullity abinitio and as such incapable of forming the basis of any orders in favour of the appellant.” 41.The Appellant produced minutes confirming its resolution to commence the construction works on the suit premises, but the said minutes do not bear any proof of adoption of the same by the members. It failed to show the signatures of the Appellant’s officials or its members. 42.In the circumstances, the court finds that the Chairman did not err in concluding that the Appellant failed to establish the intention to demolish and reconstruct the suit premises. 43.I have considered the record of appeal and the submissions by counsel and find that this appeal lacks merit and, is therefore dismissed with costs to the Respondent. DATED, SIGNED AND DELIVERED AT NAKURU THIS 14TH DAY OF JULY 2026.M. A. ODENYJUDGE