[2021] KEBPRT 407 (KLR)

REPUBLIC OF KENYA

BUSINESS PREMISES RENT TRIBUNAL

TRIBUNAL CASE NO 107 OF 2021 (NAIROBI)

DAVID MUKURIA KARANJA................TENANT

VERSUS

SAMUEL KARUME NG’ANG’A......LANDLORD

RULING

This ruling concerns the Tenant’s application dated 1st February 2021 and the Landlord’s application dated 5th February 2021. On 25th February 2021, both applications were ordered to proceed by way of written submissions.

On 3rd February 2021, the Tribunal issued the following orders pursuant to the Tenant’s application dated 1st February 2021;

1. A temporary injunction is issued restraining the Landlord/Respondent his servants and/or agents from evicting and interfering with the Applicant’s/Tenant’s business at the Landlord’s/Respondent’s premises located on land parcel No. Mugumo/Nyakinyua/1041 within Kiambu County until the hearing and determination of this application inter partes.

2. The OCS Kiamumbi Police Station to oversee that law and order is maintained.

3. Application to be served for inter parteshearing on 25th February 2021.

In his application dated 5th February 2021, the Landlord has applied that the above orders issued in favour of the Tenant be set aside and/or vacated and both the Tenant’s application and reference be dismissed for want of jurisdiction. I will endevour to summarize the application as follows;

The Tenant’s Application dated 1st February 2021 seeks;

1. Spent

2. Spent

3. That a temporary injunction be issued restraining the Landlord, his servants and/or agents from evicting and interfering with the Applicant’s/Tenant’s business at the Landlord’s/Respondents premises located on land parcel No. Mugumo/Nyakinyua/1041 within Kiambu County until the hearing and determination of this suit.

4. That the OCS Kiamumbi Police Station to oversee law and order is maintained.

5. Costs.

The grounds upon which the application is brought and the affidavit in support thereof may be summarized as follows;

1. That there exists a lease agreement between the parties herein dated 16th September 2020for a period of three years commencing 1st October 2020 at an agreed monthly rate of Kshs 35,000/-.

2. That the Tenant has been in occupation since 1st October 2020 (sic) and does not owe the Landlord any rent arrears.

3. That the Landlord’s illegal threats to evict the Tenant have been reported to the police.

4. That the Landlord has not given the Tenant formal notice to vacate the premises.

5. That the Tenant has not breached the lease agreement and the Landlord therefore has no justification to evict him.

6. That the lese is still in force.

7. The lease agreement and the occurrence book report have been annexed to the Tenant’s affidavit.

The Landlord has opposed the Tenant’s application by his replying affidavit sworn on 5th February 2021 and a “supplementary supporting affidavit” dated/sworn on 17th February 2021. The Landlord’s affidavits in reply and in support of his motion dated 5th February 2021 may be summarized as follows;

1. That in May 2020, the Tenant who had been evicted from Club Vision Kamiti Corner approached the Landlord to offer him a storage rental facility at Kshs 35,000per month.

2. That thereafter, on or about 1st October 2020, the Landlord leased the bar premises to the Tenant at an agreed monthly rent of Kshs 150,000/-.

3. That an attempt to formalize the lease did not materialize as the Landlord rejected the lease agreement prepared by Kimani Kabete & Co Advocates.

4. That the Tenant did not sign another agreement prepared by Ngugi Waithuki & Co Advocates on the instructions of the Landlord. this particular lease provided for the payment of rent at Kshs 150,000 per month amongst other requirements.

5. That the Tenant did not pay the agreed rent as a result of which the Landlord instructed counsel to make demand for the said rent and also issue a notice to terminate tenancy under section 4(2) of Cap 301.

6. That failing to have the issue resolved, the Landlord opted to evict the Tenant on 2nd June 2021.

7. That the Tenant’s application dated 1st February 2021 does not give an accurate account of the events on the ground.

8. That the lease agreement exhibited by the Tenant as DMFI is fraudulent and altered.

9. That the Tribunal lacks jurisdiction as the Tenant/Applicant is no longer a Tenant of the Landlord.

10. That the Tenant did not file any reference to the Landlord’s notice to terminate as required by the law.

11. That the Tenant owes the Landlord rent amounting to Kshs 630,000 for the period up to January 2021.

12. That the Tenant was served with the notice to terminate but failed to file a reference in opposition to the said notice to terminate the tenancy/the affidavit of service of the notice to terminate has been annexed to the Landlord’s affidavit.

13. That the Tenant who had already been evicted broke back into the premises using the orders of 3rd February 2021 and the police.

14. That the Landlord had already leased out the kitchen area of the suit premises to one Immaculate Wanjiru.

15. That the assertion that the Tenant pays a mere Kshs 35,000 per month is untenable compared to the rent being paid for much smaller space by Immaculate Wanjiru.

16. That the Tenant, a persistent rent defaulter mislead the Tribunal in obtaining the orders of 3rd February 2021.

The Tenant’s Submissions

The Tenant’s submissions dated 7th May 2021 are to the effect;

1. That the tenancy between the parties herein is a controlled tenancy and falls under the jurisdiction of the Tribunal.

2. That the Landlord has been using unlawful means to purport to terminate the tenancy.

3. That under section 4(1) of the Act (Cap 301) a controlled tenancy shall only be terminated in accordance with the provisions of the Act.

4. That the Landlord never issued the Tenant with any notice intended to terminate the tenancy and the allegation that the same was served upon the Tenant is false.

5. That the Landlord has not given any valid reason for the eviction.

6. That the lease dated 1st September 2020 and executed by both parties was drafted/prepared by counsel for the Landlord. This is the lease that fixes the rent at Kshs 35,000/- and notKshs 150,000as stated by the Landlord.

7. That the allegation that the lease is altered is false.

8. That the Tenant has never been evicted from the suit premises.

9. That the Appellant has met the requirement for the grant of the injunctive reliefs sought in the said application.

10. That the Tenant has greatly improved the suit premises at great expense and the Landlord is only driven by malice.

The Landlord’s Submissions may be Summarized as Follows;

1. That the tenancy herein was terminated via a tenancy notice dated 30th November 2020 to which the Tenant did not file a reference.

2. That the Tenant has not therefore established a prima facie case with a probability of success.

3. That the Tenant has not demonstrated that if the order he is seeking is not granted, he stands to suffer irreparable harm that cannot be compensated by way of damages.

4. That the balance of convenience tilts in favour of the Landlord.

5. That the Tenant’s application dated 1st February 2021 does not reflect the accurate account of events on the ground.

6. That the lease agreement annexed as DMFI in the affidavit of the Tenant is fraudulent and altered.

7. That the Tenant having been evicted before he came to the Tribunal, the Tribunal has no jurisdiction to hear this matter.

8. That the Tenant is indeed in rent arrears amounting to Kshs 630,000/- for the period up to January 2021.

9. That the KCB statement marked as DMK 3 in the Tenant’s further affidavit indicates that the Tenant last paid rent on 10th October 2020.

The above being the summarized narration of the parties’ respective cases, in my humble view, the following are the issues that commend themselves for determination.

1. Whether, this Tribunal has jurisdiction to hear and determine this matter?

2. Whether the Tenant is entitled to the orders sought in his application dated 1st February 2021.

3. Whether the Landlord is entitled to the orders sought in his application dated 5th February 2021.

On Issue No. 1

The lease agreement relied on by the Applicant in support of his case is the one marked as DMK 1 in the Applicant’s further affidavit sworn on 8th March 2021. The lease period indicated therein is the period of three years commencing 1st October 2020 and ending on 31st October 2023. The same is prepared by the firm of Ngugi Waithuki & Co Advocates. Although the lease agreement is seemingly executed by both parties, the Landlord has disowned the same. He states that the same is fraudulent and altered. From the affidavits of the Landlord, it is clear that the relationship between the parties herein is not governed by any written agreement.

This is borne out by paragraph 11 of the Landlord’s affidavit sworn on 5th February 2021 wherein he avers that the Tenant never returned the agreements released to him for signature. It is admitted though, that the agreement was for three years. The only point of departure is the rent payable and the required deposits.

It is clear therefore that either way, the tenancy between the parties herein is a controlled tenancy and satisfies the requirements of section 2(1) of Cap 301 which describes a controlled tenancy as a tenancy of a shop, hotel and catering establishment;

a. Which has not been reduced into writing or

b. Which has been reduced into writing and which;

I. Is for a period not exceeding five years.

II. N/A

III. N/A

The Landlord’s contention that the Tribunal lacks jurisdiction to hear this matter is not hinged on whether or not the tenancy between the parties herein is a controlled tenancy or not, rather it is hinged on the allegation that as at the time the Tenant approached the Tribunal on 3rd February 2021 by his application dated 1st February 2021, he had already been evicted from the suit premises. The Tenant was therefore no longer a Tenant of the Landlord.

Both parties have antagonistic positions on whether or not any eviction ever took place. The Tenant avers that he has always been in occupation; the Landlord is of a contrary view, that the Tenant had been evicted on 2nd March 2021. This controversy of factual positions can only be determined upon the full hearing of the reference as the averments on the affidavits are not sufficient to resolve the contradicting position. I am not able at this stage of the proceedings to determine with finality whether or not the Tenant had been evicted by the time he came to the Tribunal.

The other challenge to the jurisdiction of the Tribunal seems to be grounded on the fact that the Tenant was served with a notice of termination of tenancy and he did not file a reference in opposition to the same. The Landlord is of the position that the Tenant was served with the notice to terminate tenancy on5th December 2020. This notice is the one dated 30th November 2020 and shows its effective date to be 1st February 2021. The affidavit of service for the said notice indeed indicates that it was served on 5th December 2020.

Under section 4 of Cap 301;

“No tenancy notice shall take effect until such date, not being less than two months after the receipts thereof by the receiving party as shall be specified therein; provided…”

From the above provisions, it is therefore clear that a period of “Not Less Than Two Months” only started running with reference to 5th December 2020, the date of service and not 30th November 2020, the date of the notice. The effective date then ought to have been 1st March 2021 and not 1st February 2021. To that extent, the notice would be defective.

The Tenant on his part has denied receiving the notice to terminate his tenancy. Again, these two rival positions can only be determined through a full hearing of this dispute and a possible cross-examination of the deponent of the affidavit of service of the notice to terminate the tenancy.

I must therefore be satisfied that there was strict compliance with the provisions of the Act as far as termination of this tenancy is concerned. In Lack Vs Jeypee Investments Ltd Nairobi HCCA No 120 of 1971 (1971) EA 512, the Court started as follows;

“The Landlord and Tenants (Shops, Hotels and Catering Establishments) Act is an especially enacted piece of legislation that creates a privileged clause of Tenants for the purpose of affording them the protection specified by its provisions against ravages of predatory Landlords. Such protection can only be fully enjoyed if the provisions of the Act are observed to the letter, otherwise the clearly indicated intention of the legislature would be defeated. In order to be effecting in this fashion the Act must be construed strictly no matter how harsh the result. The Landlord and Tenant Act, laid down a code which parliament intended to be followed and if a Landlord does not give notice of termination as prescribed the notice will be ineffectual. This may seem a technical and unmeritorious defence, but there is no doubt that the court has no power to dispense with these time limits if the Defendant chooses to object at the proper time. This is an Act which requires, in so far as the giving of notice is concerned, absolute and complete not merely substantive compliance, with its presemptory provisions.”

In response to issue No. 1, I do find that the tenancy between the parties herein irrespective of whoever is right on the nature of the lease, is a controlled tenancy and falls within the jurisdiction of the Tribunal. I also do find that due to the rival positions taken by the parties, it is not possible at this juncture to determine whether or not the Tenant had been evicted as at the time he came to the Tribunal, suffice to note that the Tenant is presently in occupation of the suit premises. The Landlord admits as much but only indicates that the Tenant forcefully broke into the premises using the court order. In conclusion, I do find that the Tribunal has jurisdiction to determine this dispute.

On Issue No. 2 and 3

I have already indicated that the notice of termination of tenancy dated 30th November 2020 and served on5th December 2020could only have been effective two months from the date of receipt by the Tenant. The effective date could therefore only have been 1st March 2021 and not 1st February 2021. To that extent the notice was ineffectual.

But even assuming I am wrong on the above finding and the notice became effective on 1st February 2021, would the Landlord have been entitled, without more, to move into the Tenant’s premises and carry out an eviction?

At paragraph 15 of the Landlord’s affidavit sworn on 5th February 2021, the Landlord avers;

“That my efforts to engage him to resolve the issue through our common friends were in vain and I opted to evict him by removing all his belongings from the premises on 2nd February 2021 and he reported the same to Kiamumbi Police Station.”

My view of this matter is that a Landlord who finds himself in a situation where no reference has been filed against his notice to terminate and which notice to terminate has therefore become effective under section 10 of Cap 301, has to approach the Tribunal under the provisions of section 12 of Cap 301 for appropriate orders. This is necessary for the orderly and proper conduct of the businesses concerned. It is not in order that parties be allowed to carry out evictions in controlled tenancies without the sanction of the Tribunal. I do find that the Landlord took the law into his own hands when he purported to evict the Tenant from the business premises.

I will in the premises allow the Tenant’s application dated 1st February 2021 and decline the Landlord’s application dated 5th February 2021 which stands dismissed.

Due to the deeply conflicting positions taken by the parties especially on the monthly rent to be paid by the Tenant, I do order that the reference be fixed for hearing on a priority basis in order to safeguard the interests of all the parties.

Each party shall bear its own costs of these applications.

CYPRIAN MUGAMBI NGUTHARI

CHAIRMAN

BUSINESS PREMISES RENT TRIBUNAL

COURT:

RULING DATED AND DELIVERED VIRTUALLY BY HON CYPRIAN MUGAMBI NGUTHARI THIS 21ST DAY OF JULY, 2021IN THE PRESENCE OF NGUGI FOR THE LANDLORD/RESPONDENT AND IN THE ABSENCE OF WANJIRU FOR THE APPLICANT.

HON CYPRIAN MUGAMBI NGUTHARI

CHAIRMAN

BUSINESS PREMISES RENT TRIBUNAL