https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/8303

Bettymatt Entreprises Ltd v Absa Bank Kenya (Civil Case E007 of 2025) [2026] KEHC 8303 (KLR) (15 June 2026) (Ruling) Neutral citation: [2026] KEHC 8303 (KLR) Republic of Kenya In the High Court at Eldoret Civil Case E007 of 2025 RN Nyakundi, J June 15, 2026 Between Bettymatt Entreprises Ltd Plaintiff and Absa Bank Kenya Defendant Ruling 1.The Plaintiff lodged the instant before this court seeking for reliefs that:a.A declaration that the intended attachment, repossession, auction and sale is unlawful, unfair, oppressive, null and void ab initio.b.A declaration that the amount claimed by the 1st defendant is arbitrary, exaggerated and oppressive in view of payments already made.c.An order compelling the defendant to furnish the Plaintiff with bank statement from the date of charge to date.d.A permanent injunction restraining the defendant by itself or through its agents, servants, officers or otherwise in particular Legacy Auctioneering services from selling, disposing off, transferring, alienating or dealing whatsoever with that suit properties known as Uasin Gishu/Kimumu settlement Scheme/4929, Kericho/Kipchimchim/3265, Kericho/ Kipchimchim/5660, Kericho/Kipchimchim/5661, Kericho Municipality/ Block 5/564 and Kericho/Kipchimchim/5413. 2.The Plaintiff avers that Andrew Kipyegon Ngetich its co-director is the registered owner Uasin Gishu/Kimumu Settlement Scheme/4929, Kericho/ Kipchimchim/3265, Kericho/Kipchimchim/ 5660, Kericho/Kipchimchim/ 5661 the suit property. It also averred that Kericho/Municipality/Block 5/564 and Kericho/Kipchimchim/5413 are registered in the name of Andrew Kibet Ngetich and Peter Kipkemoi Maritim respectively. 3.The Plaintiff avers that the Defendant/Respondent advanced it a loan of Kshs. 80,000,000/= for purposes of expanding its business and as a security the applicant charged the suit properties with the defendant and the applicant deposited the said title deeds herein Uasin Gishu/Kimumu settlement scheme/4929, Kericho/Kipchimchim/3265, Kericho/Kipchimchim/5660, Kericho/Kipchimchim/5661 the suit property while Kericho Municipality/Block 5/564 and Kericho/Kipchimchim/5413 thereto as security. 4.It is the Plaintiff case that Andrew Kibet Ngetich and Peter Kipkemoi Maritim the registered owners of Kericho Municipality/Block 5/564 and Kericho/Kipchimchim/5413 respectively are guarantors who guaranteed the said loan. 5.The defendant has since filed a preliminary objection through dated 3rd December, 2025 in which he has raised the following grounds:a.The Plaintiff has no locus standi to challenge or seek relief against the defendant’s Bank’s exercise of statutory power of sale under section 103 of the Land Act, 2012, a position recently re-affirmed by the Court of Appeal in Bank of Africa Kenya Limited and another –vs- TSS Investment Limited and 2 others (Civil Appeal E055 of 2022) (2024) KECA 410 (KLR) (26th April, 2024 (Judgment) Neutral Citation: (2024) KECA 410 (KLR).b.Without locus standi, this Honorable Court does not have jurisdiction to entertain this suit further.c.As such, the entire suit should be struck out with costs. 6.In response to the Defendant's Preliminary Objection, the Plaintiff filed a Replying Affidavit sworn by Jane Kwamboka Ngetich, who deposed that she is a Director of the Plaintiff company and spouse to Andrew Kipyegon Ngetich, the other Director of Bettymatt Enterprises Limited. 7.The Plaintiff averred that the Preliminary Objection is bad in law, incompetent, mischievous, frivolous, misleading and an abuse of the court's process and ought to be struck out in limine. On the substance of the dispute, she deposes that by an offer letter dated 23rd March 2023, the Defendant offered the Plaintiff a loan facility, the relevant parties to which were identified as Bettymatt Enterprises Limited, Andrew Kipyegon Ngetich and Jane Kwamboka Ngetich. The loan facility was accepted and executed by all the stated parties as mandated by the Defendant, and the loan advancement was accordingly between those three parties. The deponent underscores the doctrine of privity of contract in this regard. 8.It is further deposed that the Defendant's agent, Legacy Auctioneers Services, purportedly served an alleged 45-day Redemption Notice dated 3rd December 2024, but that upon perusal, it was found to have been served on a person by the name Nelson Sang, who is a complete stranger to the Plaintiff and not privy to the Loan Contract with the Defendant. The notice was accordingly never served on the Plaintiff. The deponent relies on the case of Palmy Company Limited v Consolidated Bank Kenya Limited for the proposition that a statutory notice that does not provide a clear breakdown of outstanding sums and steps to rectify default is invalid. She further avers that statutory notices are not a mere formality but serve a protective function, ensuring that all affected parties privy to the loan, including borrowers, are granted the equity of redemption recognized by the Land Act and by equity, so as not to be unjustly extinguished without due notice. The right of redemption, she avers, continues until property is legally transferred through a valid sale, and denial of the opportunity to redeem through improper notice defeats equity, which courts have routinely intervened to protect. 9.On the question of locus standi, she deposed that the Defendant should be stopped from invoking the provisions of Section 103 of the Land Act to rewire the charges and deny the Plaintiff the right to have its dispute resolved through a fair and public hearing before a court as enshrined in Article 50 of the Constitution. The deponent distinguishes the authority cited by the Defendant, Bank of Africa Kenya Limited and Another v TSS Investment Limited and 2 Others, on the basis that the relationship between the parties and the prayers sought therein are distinctly different from the circumstances of the present case. She further avers that as the borrower of the loan, the Plaintiff was privy to and has a stake in the charges, and ought to have been properly served with all the Statutory Notices as required by law and as amplified by Paragraph 40 of the Charges. In that regard, the deponent submits that the Plaintiff has locus standi to challenge or seek reliefs against the Defendant's exercise of the statutory power of sale by reason of the non-service of the Statutory Notices. 10.On the question of the court's discretion to strike out the suit at an interlocutory stage, the deponent avers that every person has a right to have any dispute resolved by application of the law in a fair and public hearing before a court as enshrined in Article 50 of the Constitution. She further deposes that this Honourable Court, by its ruling of 13th June 2025, found that the Plaintiff had a prima facie case with a probability of success. She additionally relies on the Court of Appeal's decision in P.J. Dave Flowers Limited v Limuru Hills Limited & 2 Others (Civil Appeal 123 of 2019) [2022] KECA 129 (KLR) (18th February 2022), in which the Court of Appeal dismissed a similar Preliminary Objection. Analysis and determination 11.This Court has carefully considered the Preliminary Objection raised by the Defendant/Applicant, the Replying Affidavit filed on behalf of the Plaintiff/Respondent sworn by Jane Kwamboka Ngetich, the written submissions filed by both parties, and the authorities cited therein. 12.From the pleadings and submissions before the Court, the sole issue that falls for determination is whether the Plaintiff has locus standi to challenge or seek relief against the Defendant's exercise of its statutory power of sale. 13.The governing principles on this question are settled and were authoritatively stated by the Court of Appeal for Eastern Africa in Mukisa Biscuit Manufacturing Co. Ltd v West End Distributors Ltd [1969] EA 696. At page 700, Law, JA stated:“A Preliminary Objection consists of a point of law which has been pleaded, or which arises by clear implication out of pleadings and which if argued as a preliminary point may dispose of the suit. Examples are an objection to the Jurisdiction of the Court or a plea of limitation, or a submission that the parties are bound by the contract giving rise to the suit to refer the dispute to arbitration”At page 701, Sir Charles Newbold, P added:“A Preliminary Objection is in the nature of what used to be a demurrer. It raises a pure point of law which is usually on the assumption that all the facts pleaded by the other side are correct. It cannot be raised if any fact has to be ascertained or if what is sought is the exercise of Judicial discretion....” 14.This foundational statement has been consistently applied and refined. Ojwang, J (as he then was) in Oraro v Mbaja [2005] eKLR stated:“preliminary objection”, correctly understood, is now well identified as, and declared to be a point of law which must not be blurred with factual details liable to be contested and in any event, to be proved through the processes of evidence. Any assertion which claims to be a preliminary objection, and yet it bears factual aspects calling for proof, or seeks to adduce evidence for its authentication, is not, as a matter of legal principle, a true preliminary objection which the Court should allow to proceed.” 15.The import of these authorities is clear. A preliminary objection must arise purely on the face of the pleadings, proceed on the assumption that all facts pleaded by the opposing side are correct, and possess the capacity to dispose of the matter at the threshold stage without requiring any factual inquiry or the exercise of judicial discretion. Anything short of this standard is not a true preliminary objection in law. 16.The Defendant's Preliminary Objection contends that the Plaintiff has no locus standi under section 103 of the Land Act, 2012 to challenge the exercise of the chargee's statutory power of sale, and that without such standing this Court has no jurisdiction to entertain the suit. The resolution of those contentions cannot, however, be undertaken in isolation of the specific factual circumstances of this case, including the nature of the Plaintiff's relationship to the loan facility, the identity of the chargors of the suit properties, and the manner in which the statutory notice was served. Those are factual matters that emerge on the face of the pleadings and are squarely disputed between the parties. The Court proceeds to consider the substance of the Preliminary Objection with that caveat in mind. 17.The Defendant anchors its objection on the decision of the Court of Appeal in Bank of Africa Kenya Limited & another v TSS Investment Limited & 2 others [2024] KECA 410 (KLR), which affirmed the settled position in Nairobi Mamba Village v National Bank of Kenya [2002] 1 EA 197, that only the chargor can legitimately seek relief against a chargee's exercise of its statutory power of sale. In that case, the parties seeking to restrain the bank were lessees third parties who operated a car bazaar business on the charged properties as tenants of the chargor, TSS Investment Limited. They had no contractual relationship with the bank, no proprietary interest in the charged properties, and no stake in the charge instrument itself. Affirming the position in Nairobi Mamba Village, the Court of Appeal held that the deletion of section 103(1)(d) of the Land Act by the Land Laws (Amendment) Act No. 28 of 2016 had conclusively removed lessees from the closed category of persons entitled to seek relief against a chargee's statutory power of sale. 18.Section 103(1) of the Land Act, 2012 as it currently stands provides that an application for relief against the exercise by the chargee of any of the remedies referred to in section 90(3) may be made by the chargor, one or more joint chargors acting in their own behalf, a spouse of the chargor who was required to give consent to the creation of the charge but did not, and the trustee in bankruptcy of the chargor. The lessee of the chargor, who previously fell under section 103(1)(d), was deliberately excised from that category by the 2016 amendment. 19.The question, then, is whether the Plaintiff falls within any of those categories. The Plaintiff avers that by an Offer Letter dated 23rd March 2023, the Defendant offered it a loan facility of Kshs. 80,000,000/=, identifying the relevant parties as Bettymatt Enterprises Limited, Andrew Kipyegon Ngetich, and Jane Kwamboka Ngetich. The facility was accepted and executed by all those parties. As security for the repayment of that loan, the suit properties were charged with the Defendant. Some of those properties being Uasin Gishu/Kimumu Settlement Scheme/4929, Kericho/Kipchimchim/3265, Kericho/Kipchimchim/5660 and Kericho/Kipchimchim/5661 are registered in the name of Andrew Kipyegon Ngetich, a co-director of the Plaintiff. Kericho/Municipality/Block 5/564 is registered in the name of Andrew Kibet Ngetich, and Kericho/Kipchimchim/5413 in the name of Peter Kipkemoi Maritim, both of whom the Plaintiff identifies as guarantors to the loan. 20.Looking at the factual matrix in this case, it is distinguishable from the scenario in TSS v Bank of Africa. The Plaintiff is not a stranger to the charge. It is not a lessee seeking to shield itself from the consequences of a landlord's default on a loan to which it was never a party. The Plaintiff is the borrower. It is the very entity for whose benefit the loan was advanced, the entity that accepted and executed the loan facility, and the entity in whose favour the purpose of the charged properties was engaged. Whether that position qualifies the Plaintiff as a chargor within the meaning of section 103(1)(a), or places it in a sufficiently proximate relationship to the charge to confer standing to seek relief, is a question that turns on the specific terms of the charge instruments and the precise legal character of the relationship between the Plaintiff, its directors, and the Defendant. That is not a question answerable on the face of the pleadings. It requires examination of evidence. 21.The Court also notes the Plaintiff's averment that the 45-day Redemption Notice dated 3rd December 2024 was served not on the Plaintiff or its principals, but on one Nelson Sang, described as a complete stranger to the loan. If that averment is correct, the validity of the notice and the lawfulness of the Defendant's move to exercise the statutory power of sale are squarely in issue. 22.Having carefully considered the Preliminary Objection, the Replying Affidavit, the submissions of both sides, and the authorities placed before this Court, the Court finds that the Defendant's Preliminary Objection does not raise a pure point of law that can dispose of the suit without a factual inquiry. The question of whether the Plaintiff has locus standi as the borrower under the loan facility cannot be resolved without examining the charge instruments and the precise legal relationships they create. The standard in Mukisa Biscuit and Oraro v Mbaja is not met. 23.In the premises, the Preliminary Objection dated 3rd December 2025 is found not merited and is hereby dismissed. The costs of the Preliminary Objection shall be in the cause. 24.Orders accordingly. DATED AND DELIVERED AT ELDORET VIA CTS AND EMAIL THIS 15 THE DAY OF JUNE 2026…………………………………….R. NYAKUNDIJUDGE