[2021] KEBPRT 43 (KLR)

REPUBLIC OF KENYA

BUSINESS PREMISES RENT TRIBUNAL

VIEW PARK TOWERS 7TH & 8TH FLOOR

TRIBUNAL CASE NO. 126 OF 2021 (NAIROBI)

FINANCE AND SYSTEM CONSULTANTS LIMITED............APPLICANT/TENANT

VERSUS

KENYA MEDICAL PROPERTIES LIMITED..........1ST RESPONDENT/LANDLORD

GIMCO LIMITED........................................2ND RESPONDENT/MANAGING AGENT

MARGARET MUNYUA.....................................................................3RD RESPONDENT

RULING

1. Before me is a motion dated 4th February 2021 in which the tenant is seeking for restraining orders against the Respondents from harassing, evicting, levying distress, intimidating, closing the suit premises or threatening to evict the tenant and/or in any other manner whatsoever interfering with its quiet possession and lawful enjoyment of the suit premises.

2. The application is supported by the affidavit of one Peterson Mwangi who is the managing Director of the Applicant wherein it is deposed that the applicant has greatly disrupted by Covid-19 pandemic resulting into inability to meet its obligations.

3. On 8th December 2020, the tenant wrote to the landlord seeking indulgence for extension of time to settle rent and service charge arrears. This is the same day when electricity supply was disconnected. The request was rejected.

4. Electricity was not reconnected although the landlord continued to send bills to the tenant. A payment plan was forwarded on 4th January 2021 but the same was declined giving 7 days to settle.

5. On 29th January 2021, a cheque of Kshs.170,350/- was issued in favour of the landlord but instead, the landlord sent auctioneers after 2 days to attach the tenant’s properties in a show of bad faith. A proclamation was issued on 2nd February 2021. This prompted the current suit.

6. The application is opposed though a replying affidavit of Simon M. Warui, a director of the 2nd Respondent which manages the property.

7. According to the 2nd Respondent, the tenant entered into a licence agreement after the initial lease expired. The said licence agreement is annexed as ‘S.M.W.1’. I however note that the same is not signed by the tenant and does not constitute a contract document.

8. According to the 2nd Respondent, the tenant was in arrears of rent and electricity bills leading to power disconnection. As at 13th December 2020, the tenant was in arrears of Kshs.840,859. 06.

9. It is the Respondent’s case that the payment of Kshs.170,350/- was part of the indebtedness on the part of the tenant. As at 2nd February 2021, the tenant was indebted in the sum of Kshs.1,010,954. 97 and as such the 1st Respondent acted lawfully in instructing auctioneers to levy distress under the Distress for Rent Act.

10. The Respondents contend that the tenant is legally obligated to pay rent and other services and cannot be allowed to do so by instalments without the 1st Respondent’s consent. The 1st Respondent has service and loan facility to pay.

11. Upon payment of Kshs.170,350/-, the tenant remained with a balance of Kshs.918,323. 10 in rent arrears as per annexture ‘SMW4’. As at 13th December 2020, the tenant was in arrears of Kshs.27,991. 37.

12. Despite the Tribunal order that the tenant pays rent as and when the same falls due and payable, the order was not complied with and the application and reference had no merit.

13. The 3rd Respondent is an employee of the 2nd Respondent and there was no reason to enjoin her in the proceedings according to the latter.

14. Finally, the 2nd Respondent contends that, the applicant having failed to pay for electricity cannot expect to receive services not paid for.

15. The application was ordered to be disposed of by way of written submissions. Both parties complied.

16. The tenant’s reference raises the same issues as the application and as such both shall be determined through this ruling together.

17. The issues for determination going by the pleadings are:-

(a) Whether the tenant is entitled to the reliefs sought,

(b) Who is liable to pay costs of the proceedings?

18. Before me is an application for injunction. The principles considered in such an application were long settled in the case of Giella – vs- Cassman Brown & Co. Ltd (1973) EA 358 as follows:

(i) An applicant must show a prima facie case with a probability of success.

(ii) An injunction will not normally be granted unless the applicant might otherwise suffer irreparable injury.

(iii) When the court is in doubt, it will decide the application on the balance of convenience.

19. In the instant case, there is no dispute that the tenant owes rent arears. No proposal has been made on how the same will be settled.

20. The tenant has further conceded that electricity bill had not been paid at the time it came to court. Would a court of equity protect such a tenant?.

21. It is trite law that he who comes to equity must come with clean hands. In the case of Kyangavo – vs. Kenya Commercial Bank Ltd and Another (2004) IKLR 126, It was held as follows:-

“Secondly, the injunction sought is an equitable remedy. He who comes to equity must come with clean hands and must also do equity. The conduct of the applicant in this case betrays him. It does not endear him to equitable remedies. He who comes to equity must fulfil all or substantially all his outstanding obligations before insisting on his rights. The Applicant has not done that. Consequently, he has not done equity”.

22. In the case of Samuel Kipkori Ngeno and Another – vs- Local Authorities Pension Trust (Registered Trustees) & Another (2013) eKLR at paragraph 9 and 12, the court held as follows:-

“9. A tenant’s first and main obligation is to pay rent as and when it becomes due for the landlord has the right to an income from his investment. Why would a tenant allow himself to fall into such huge arrears of rent”.

“12. The temporary injunction sought in the present application is an equitable remedy at the court’s discretion. He who comes to equity must come with clean hands. A tenant who is in huge arrears of rent is underserving of the court’s discretion. The court cannot be refuge of a tenant who fails to meet his principal obligation of paying rent as and when it becomes due”.

23. The foregoing cases provide sufficient guidance in dismissing the current application as the tenant is guilty of all the tenets upon which an injunction should be denied. I need say no more.

24. Suffice to state that almost one year from the date when the proclamation was done, the tenant has not made good its purported proposal to settle the arrears. It is underserving of this Tribunal’s protection.

25. In the premises, the orders that commend to me are:-

(a) The application dated 4/2/2021 and the reference of even date is dismissed with costs.

(b) The orders given on 8th February 2021 are hereby discharged and/or vacated forthwith.

(c) The Respondents costs of Kshs.30,000/- shall be paid by the tenant.

It is so ordered.

DATED, SIGNED AND DELIVERED THIS 21ST DAY OF DECEMBER 2021 VIRTUALLY.

HON. GAKUHI CHEGE

VICE CHAIR

BUSINESS PREMISES RENT TRIBUNAL

Ruling delivered in the absence of parties.