[2010] KEHC 989 (KLR)
The court found that the defendant, Consolidated Bank, had locus standi to enforce the loan agreement as the legal successor to Business Finance Company Limited, as evidenced by the unchallenged legal notice. The plaintiff failed to provide evidence of full repayment of the loan, with the only payment on record...
Source-derived case information.
- Citation
- [2010] KEHC 989 (KLR)
- Parties
- Plaintiff: Gilbert Nyabwegi Manyange; Respondent: Consolidated Bank
- Court
- High Court
- Court Station
- High Court at Kisii
- Jurisdiction
- Kenya
- Case Number
- Civil Suit 58 of 2008
- Procedural Posture
- Civil Suit / Ruling on Interlocutory Injunction
- Outcome
- application dismissed
- Legal Topics
- Interlocutory Injunctions, Statutory Power of Sale, Loan Default, Privity of Contract, Mortgage Enforcement, Ownership Disputes
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Gilbert Nyabwegi Manyange
Plaintiff
Consolidated Bank
Respondent
Procedural Posture
Civil Suit / Ruling on Interlocutory Injunction
Legal Issues
- 1 Whether the plaintiff is entitled to an interlocutory injunction restraining the defendant from disposing of the suit property.
- 2 Whether the defendant has locus standi to demand repayment and exercise statutory power of sale over the suit property.
- 3 Whether the plaintiff has established a prima facie case for the grant of an injunction.
Ratio Decidendi
The court found that the defendant, Consolidated Bank, had locus standi to enforce the loan agreement as the legal successor to Business Finance Company Limited, as evidenced by the unchallenged legal notice. The plaintiff failed to provide evidence of full repayment of the loan, with the only payment on record being Kshs. 3,054/=, and arrears were established as early as 1984. The defendant had served the statutory notice required for the exercise of the statutory power of sale. The plaintiff did not establish a prima facie case or demonstrate any basis for restraining the defendant from exercising its statutory rights. Consequently, the application for an interlocutory injunction was...
Court Disposition
application dismissed
Orders
- The plaintiff's application for interlocutory injunction is dismissed with costs to the defendant.
Full Case Text
Judgment text and source record
28 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA
AT KISII
CIVIL SUIT NO. 58 OF 2008
GILBERT NYABWEGI MANYANGE...............................................................................PLAINTIFF
VERSUS
CONSOLIDATED BANK............................................................................................RESPONDENT
RULING
The plaintiff sought an interlocutory injunction to restrain the defendant, its servants and/or agents from disposing of a property known as L.R. No. Wanjare/Bokeire/975, hereinafter referred to as “the suit property”, or interfering with his quite enjoyment of the same in any manner whatsoever.
In his affidavit in support of the application, he stated that he is the registered owner of the suit property. In 1984 or thereabout he was advanced a loan of Kshs. 60,000/= by Business Finance Company Limited which was secured by a charge over the suit property. He alleged that he had paid the entire loan and nothing was outstanding. On 17th April 2008 he was served with a notification of sale of the suit property which was issued by the defendant. He alleged that the defendant is a stranger to him since the aforesaid loan had been advanced to him by Business Finance Company Limited. The defendant is now demanding Kshs. 960,114. 75. In his view, the intended sale of his property is unlawful since there is no privity of contract between himself and the defendant. The plaintiff further stated that he is residing on the suit property together with his family members and he stands to suffer irreparable loss if the order of injunction is not granted as the suit property may be sold.
The defendant filed a replying affidavit through Julius Mwaniki Gikonyo,a Remedial Officer. He stated that on 8th February 1984 the defendant’s predecessor in title, Business Finance Company Limited, granted the plaintiff a loan facility amounting to Kshs. 60,000/=. The deponent annexed to his affidavit a legal notice dated 25th July, 2002, which showed that all the undertakings of Business Finance Company Limited among other companies were vested in the Consolidated Bank of Kenya Limited. The loan was repayable within 24 months by equal monthly installments of Kshs.3,054/=. The plaintiff charged the title to the suit property to secure the said facility. The plaintiff defaulted in repayment and the loan balance as at 17th April 2008 stood at
Kshs. 960,114. 75. It was therefore not correct that the plaintiff had fully repaid the loan. The defendant is thus exercising its statutory power of sale.
The parties filed their respective submissions which I have duly considered.
The aforesaid Legal Notice which was not challenged by the plaintiff clearly demonstrates that the Consolidated Bank of Kenya Limited took over all the undertakings of Business Finance Company Limited and therefore it has locus standi to demand repayment of the loan balance from the plaintiff.
There is no evidence that the plaintiff repaid the loan that was advanced to him. It is clear from the annextures to his affidavit that the only sum that he paid was Kshs. 3,054/= which was sent by his letter dated 11th June, 1984. As at that date the account was in arrears of Kshs. 6,108/=.
On 26th July, 1984, the lender wrote to him stating that he was in arrears of Kshs.9,162/=. There is no evidence that any other repayment was made. In the circumstances, the plaintiff has no basis of challenging the defendant’s exercise of its statutory power of sale, a statutory notice having been served on him.
The plaintiff’s application is without any merit. He has not established a prima facie case as against the defendant. Consequently, I dismiss the application with costs to the defendant.
DATED, SIGNED AND DELIVERED AT KISII THIS 29TH DAY OF JULY, 2010.
D. MUSINGA
JUDGE.
29/7/2010
Before D. Musinga, J.
Mobisa – cc
Mr. Oguttu for Mr. Mereka for the Respondent
Mr. Nyagwencha for Mr. Mongeri for the Applicant
Court:Ruling delivered in open court on 29th July, 2010.
D. MUSINGA
JUDGE.