Mediheal Hospital & Fertility Centre Ltd v NCBA Bank Kenya PLC & 2 others (Commercial Case E003 of 2024) [2026] KEHC 13176 (KLR) (31 August 2026) (Judgment)

**REPUBLIC OF KENYA** **IN THE HIGH COURT AT ELDORET** **HCCOMM NO. E003 OF 2024** **MEDIHEAL HOSPITAL & FERTILITY CENTRE LIMITED**………..**PLAINTIFF** **=VERSUS=** **NCBA BANK KENYA PLC**………………………………………...**1ST DEFENDANT** **PHILLIPS INTERNATIONAL AUCTIONEERS** ……………….**2ND DEFENDANT** **NCBA LEASING LLP**………………………………………………..**3RD DEFENDANT** **Coram:** **Before Justice R. Nyakundi** **M/S. Aloo Romanus & Company Advocates** **M/S. Mburu Maina & Company Advocates** **JUDGMENT** 1. **INTRODUCTION** 2. The Plaintiff, Mediheal Hospital and Fertility Centre Limited, operates a private hospital at Eldoret and elsewhere. By a Plaint dated 6th May, 2024 and filed on the same date it sued NCBA Bank Kenya PLC and Phillips International Auctioneers, complaining that on or about 26th March, 2024 the Defendants attended its premises and proclaimed the whole of its medical equipment. NCBA Leasing LLP was subsequently joined as the 3rd Defendant. 3. The Plaintiff's complaint, as pleaded, was threefold: that the machines proclaimed did not belong to it or to the Defendants but were leased from a third party, Jamii Bora Leasing Limited; that it was not in default; and that in any event the Defendants had proceeded irregularly, in that they had proclaimed and attached without a Court order, without a warrant commensurate with the alleged debt, and without furnishing statements of account. 4. The Defendants' answer is that the equipment is the property of the 3rd Defendant, having been supplied to the Plaintiff under a Master Lease Agreement dated 9th August, 2018; that the Plaintiff has been and remains in substantial arrears of rent; that the lease was lawfully terminated for breach of an essential term; and that the repossession was a contractual entitlement requiring no order of the Court. 5. Interim orders restraining repossession were granted at the commencement of the suit and have remained in force. The matter has been heard and both sides have filed written submissions. This judgment determines the suit. 6. **THE PLAINTIFF'S CASE** 7. By the Plaint the Plaintiff seeks a declaration that the proclamations of attachment dated 26th March, 2024 are null and void *ab initio*; a permanent injunction restraining the Defendants from demanding from it in any way as regards the debt; in the alternative, an injunction restraining the 1st Defendant from proclaiming and attaching any of its property; costs; and such further relief as the Court may grant. The particulars of illegality pleaded at paragraph 9 of the Plaint are a failure to issue a warrant of attachment commensurate to the alleged debt, a failure to follow legal procedure by proclaiming before filing suit, and a failure to furnish bank statements. 8. The Plaintiff's evidence was contained in the witness statement of Maryline Chepkosgei Langat, its Manager. She stated that the parties have an existing lease agreement over hospital equipment dated 9th August, 2018; that the Plaintiff had been servicing the facility without difficulty until sometime in 2023, when the hospital became the subject of government attention concerning kidney transplants, whereupon a deliberate decision was taken not to admit further patients; that the 3rd Defendant instructed the 2nd Defendant on or about 22nd March, 2024 to repossess the equipment without prior notice or a Court order; that the Plaintiff never received the notice of termination dated 30th January, 2024 or the letter dated 28th November, 2023, and indeed received no earlier correspondence at all; that the Plaintiff's business is life-saving, involving critically ill patients on ventilators and kidney transplant work, so that execution would affect innocent patients; that under Clause 7.1 of the agreement the rental premiums included insurance, so that any lost or stolen items are covered; and that at a joint inspection conducted in February 2026 some ninety per cent of the equipment was found available and operational. 9. It is to be noted that the Plaintiff's witness did not attend for examination in chief or cross-examination, the Plaintiff having elected to rely on the statement and documents as filed. 10. **THE DEFENDANTS' CASE** 11. By a joint Defence dated 16th July, 2024 the Defendants deny the claim. They plead that by a Master Lease Agreement dated 9th August, 2018 the Plaintiff and the 3rd Defendant entered into an equipment lease under which the 3rd Defendant rented assorted medical equipment to the Plaintiff for valuable consideration and delivered it to the Plaintiff's hospitals; that the Plaintiff blatantly breached the terms of the agreement and failed to remit the agreed rental; that upon that breach the 3rd Defendant was at liberty under the agreement to terminate and to repossess without a Court order; that a Lease Termination Notice was duly issued and instructions given to the 2nd Defendant; that the Plaintiff was at all times kept abreast of the state of its rental account; and that the suit is fatally defective, discloses no cause of action, and is an abuse of process. 12. The Defendants called one witness, DW1, David Khisa, the 3rd Defendant's Senior Asset Manager. He adopted his witness statement dated 2nd December, 2024 and produced the documents in the Defendants' list of that date as D-Exhibits 1 to 46, together with the joint inspection report of 10th February, 2026 as D-Exhibit 47. 13. His evidence was that the 3rd Defendant, formerly NIC Leasing LLP and a subsidiary of NCBA Group PLC, is the sole and absolute proprietor of the equipment; that the equipment was procured from Medivision Equipment Limited, Sciencescope Limited and Meditec Systems Limited and delivered to the Plaintiff, which acknowledged receipt in good order as Lessee; that the 3rd Defendant settled its suppliers' invoices in full; that at the time of leasing it obtained Letters of Exclusion from the Plaintiff's other financiers holding debentures over its assets, and that Jamii Bora Leasing Limited did not feature among them; that the Plaintiff issued the 1st Defendant with irrevocable standing instructions to debit its account No. 1005779185 in settlement of the monthly rentals; that in breach of those undertakings the Plaintiff fell into arrears which could not be debited for want of funds; that demand notices were issued; that upon continued default the 3rd Defendant terminated the lease and instructed the 2nd Defendant to repossess; and that the Plaintiff declined to deliver up the equipment and obtained interim orders without disclosing the 3rd Defendant's interest. 14. DW1 further deposed that some of the 3rd Defendant's equipment is missing from the Plaintiff's premises; that on 27th July, 2024 the Plaintiff admitted having withdrawn some of the equipment ostensibly for safe custody and failed to deliver it up; and that part of the equipment is locked inside the Plaintiff's town clinic, to which the landlord has denied access on account of rent arrears. 15. **THE DOCUMENTARY RECORD** 16. The essential chronology, which is largely established by documents whose authenticity was not challenged, is as follows: 1. 9th August, 2018 - Letter of offer and Master Lease Agreement between NIC Leasing LLP (as Lessor) and the Plaintiff (as Lessee), executed under the Plaintiff's common seal and supported by a Board Resolution dated 13th August, 2018. 2. 2018 to 2023 - Twelve Lease Schedules numbered NLLLP/MHFCL/001 to 012, each identifying particular equipment, rentals, term and an Overdue Rate of interest of 30 percentage points per annum on outstanding rentals. Delivery notes from Medivision, Sciencescope and Meditec evidence delivery. 3. Letters of No Objection and of Exclusion of Financed Assets from Bank of India dated 6th September, 2018, 6th December, 2018 and 6th May, 2019, excluding the leased equipment from the debenture held by that bank. 4. Irrevocable standing instructions from the Plaintiff to the 1st Defendant to debit account No. 1005779185 in favour of the Lessor. 5. 26th July, 2023 - Letter extending the Master Lease Agreement from 15th July, 2023 to 15th July, 2025 in respect of Lease Schedules 009, 010 and 011; the term for Schedule 012 was extended to 15th August, 2025. 6. 6th September, 2023 - Demand for Kshs. 13,653,565/=, giving fourteen days. 7. 28th November, 2023 - Further demand for Kshs. 22,243,281/=, giving fourteen days. 8. 30th January, 2024 - Notice of Lease Termination, citing arrears of Kshs. 28,694,022/= and invoking Clause 9.1(a) and Clause 10.1(a), terminating pursuant to Clause 11.1, requiring return of the equipment within seven days, and notifying set-off under Clause 4.6 of the Kshs. 12,215,199/= held as upfront rentals. 9. 22nd March, 2024 — Collection/Repossession Order addressed to the Plaintiff through Phillips Auctioneers, authorizing collection of Kshs. 16,977,776/= or, otherwise, possession of the listed items. 10. 26th March, 2024 — Proclamations of Attachment/Repossession of Movable Property issued by the 2nd Defendant on Sale Form 2 under the Auctioneers Act. 11. 2nd October, 2024 and 10th February, 2026 — Joint inspection reports; and a co-signed collection record dated 26th July, 2024. 17. The joint inspection report of 10th February, 2026 records that a number of assets were present and functional; that the Immunoassay Roche E411 and the Electrolyte Analyzer Roche 9180 powered on but could not be verified, having last been used some two years earlier; that the Plaintiff reported the Urine Analyzer URISYS 1100, a Horiba 5 Parts Analyzer, a Portable Ultrasound Machine CX50 Diamond Select, an X-Ray Machine Allengers 325 and a CUSA Sonoca 300 as stolen or lost, without supporting documentation; that further assets were not found; and that the ICU wing was locked and chained, with equipment showing last recorded use between August and December 2023. 18. **SUBMISSIONS** 19. For the Plaintiff, M/s. Aloo Romanus & Company Advocates submitted that the contract must be construed as a whole; that Clause 17 required ninety business days' notice before end of term and provided for automatic extension for twelve months absent notice; that Clause 11.2 obliged the Lessor to afford ten days within which to remedy a default; that there is no evidence that the letters of 6th September, 2023 and 30th January, 2024 were ever served, an advance copy by email being asserted without any extract in proof; that by Sections 109 and 112 of the Evidence Act the burden of proving service lay on the 3rd Defendant; that the transaction is a financial lease to which the Movable Property Security Rights Act, 2017 applies, so that Sections 65 to 67 required a notice in the prescribed form stating the nature and extent of default and the steps to remedy it; that the interval between the termination notice and the proclamation was some sixty days rather than the ninety contemplated; and that the equipment was insured under Clause 7.1 so that any lost items are a matter between the 3rd Defendant and its insurer. Counsel relied on *National Bank of Kenya Ltd v. Pipeplastic Samkolit (K) Ltd & another, Busienei v. Lizano Limited (Civil Appeal E078 of 2021) [2025] KEHC 4483 (KLR), and Mogo Auto Limited v. Otianga (Civil Appeal E036 of 2024) [2024] KEHC 13055 (KLR)*. 20. For the Defendants, M/s. Mburu Maina & Company Advocates submitted that the Plaintiff admitted its indebtedness in the course of the proceedings and did not challenge the statement of account showing Kshs. 24,918,824/= outstanding as at 2nd December, 2024; that Clause 9.1 sets out essential terms whose breach repudiates the agreement, including failure to pay rentals on time, failure to insure, cessation of business, insolvency, parting with possession of the equipment and failure to replace lost or stolen equipment, all of which are engaged; that the Court should take judicial notice of Milimani Insolvency Cause Miscellaneous Application No. E547 of 2024; that the issuance of notices was discretionary, the operative word in Clauses 11.1 and 11.2 being "may"; that the Court cannot rewrite the parties' bargain; that a party in breach cannot obtain an injunction restraining the other's exercise of contractual rights; that the Plaintiff approached the Court with unclean hands by alleging that the equipment belonged to Jamii Bora Leasing Limited and by omitting the 3rd Defendant from the suit as originally constituted; and that the suit should be dismissed with costs. Counsel relied on *Kenya Breweries Ltd v. Okeyo [2002] 1 EA 109, John Edward Ouko v. National Industrial Credit Bank Ltd [2013] eKLR, Yusuf Abdi Ali Co Ltd v. Family Bank Limited [2015] eKLR, Pipeplastic Samkolit (supra), Ahmed Mohammed Noor v. Abdi Aziz Osman [2019] KEHC 12480 (KLR), Hellen Wangari Wangechi v. Carumera Muthoni Gathua [2015] eKLR, and Independent Electoral and Boundaries Commission & another v. Stephen Mutinda Mule & 3 others [2014] eKLR.* 21. **ISSUES FOR DETERMINATION** 22. The following issues arise: 23. Who owns the equipment the subject of the proclamations? 24. Was the Plaintiff in breach of the Master Lease Agreement? 25. Was the Master Lease Agreement lawfully terminated, and was service of the requisite notices proved? 26. Does the Movable Property Security Rights Act, 2017 apply, and if so was it complied with? 27. Were the proclamations of 26th March, 2024 regular? 28. Is any case made out against the 1st and 2nd Defendants? 29. What reliefs, if any, should issue, and who bears the costs? 30. **ANALYSIS AND DETERMINATION** ***Ownership of the equipment*** 1. The foundation of the Plaint is the assertion at paragraph 5 that the machines "are leased from a third party Jamii Bora Leasing Limited" and that they "do not belong to" the Defendants. That assertion cannot survive contact with the record. 2. Clause 6.2 of the Master Lease Agreement provides in terms that the Equipment "will remain the property of NIC Leasing LLP and/or its successors or assigns", and that the Lessee "only ha[s] the right to use the Equipment". Clause 12.1 records that no representation has been made entitling the Lessee to acquire the Equipment at a later date. The 3rd Defendant produced its certificate of incorporation as a limited liability partnership and its certificate of change of name from NIC Leasing LLP to NCBA Leasing LLP. It produced the suppliers' invoices and delivery notes, and evidence of settlement of those invoices. It produced letters from Bank of India excluding the financed assets from that bank's debenture — documents which would be pointless unless the 3rd Defendant were financing and owning the equipment. 3. Against that, the Plaintiff produced a Jamii Bora Leasing Limited offer letter dated 13th September, 2017 accepted under its common seal. That document establishes only that the Plaintiff had a separate leasing relationship with Jamii Bora in 2017. It does not identify any of the equipment proclaimed in March 2024, and it long predates the Lease Schedules under which that equipment was supplied. No witness was called from Jamii Bora. No schedule, delivery note or invoice was produced linking Jamii Bora to a single item on the proclamations. 4. Tellingly, the Plaintiff's own written submissions abandon the point altogether. They open by stating that "the Plaintiff and the Defendant entered into a lease agreement" and proceed on the footing that the Master Lease Agreement of 9th August, 2018 governs the parties' relationship. A party is bound by its pleadings, but where it resiles from a pleaded case in submissions the Court is entitled to treat the allegation as abandoned. I so treat it. 5. I find as a fact that the 3rd Defendant is the owner of the equipment listed in the Lease Schedules, and that the Plaintiff held it as bailee with a contractual right of use only. ***Breach*** 1. Clause 9.1 designates as fundamental and essential the terms that the Lessee pay all lease instalments on time, keep the Equipment insured as set out in Clause 7, and not cease or threaten to cease carrying on business; and, in the portions appearing at Clause 9.1(d) to (f), that it not become insolvent or unable to pay its debts, not part with possession of the Equipment without written consent, and comply with the obligation under Clause 8.1 to replace lost, stolen or damaged Equipment. Clause 9.2 provides that a breach of any essential term amounts to repudiation. 2. On non-payment there is, in the end, no contest. The Plaintiff's own submissions state that it "fell into some arrears in terms of payment of the lease amount". Its witness explained the reason: from 2023 the hospital became the subject of government scrutiny concerning kidney transplants and a deliberate decision was taken not to admit further patients. That is an explanation of the default, not a denial of it. The statements of the rental account were produced and were not challenged. The successive demands trace the arrears from Kshs. 13,653,565/= in September 2023 to Kshs. 28,694,022/= in January 2024, and the figure of Kshs. 16,977,776/= in the Collection Order of 22nd March, 2024 is consistent with those arrears after crediting the set-off of Kshs. 12,215,199/= notified under Clause 4.6. The arithmetic hangs together. 3. I find that the Plaintiff was in breach of Clause 9.1(a), which is an essential term, and that the breach was substantial and continuing. 4. I do not, however, accept the whole of the Defendants' case on breach. Three of the further breaches urged are not made out. 5. First, insurance. Clause 7.1 provides that it is the Lessor which "undertake[s], at our option, to procure that the Equipment is insured", the Lessee electing that the premiums "will be included in the rental instalments specified in the applicable Rental Schedule". On the face of the agreement the procurement of insurance was the Lessor's undertaking, funded out of the rentals. It does not lie easily in the 3rd Defendant's mouth to complain that the Plaintiff "failed on its duty to show that the equipment was adequately insured" when the contractual burden of procuring that insurance was its own. No policy was produced by either side. I decline to find a breach of Clause 9.1(b). 6. Secondly, insolvency. The Defendants invite the Court to take judicial notice of Milimani Insolvency Cause Miscellaneous Application No. E547 of 2024. A Court may take judicial notice of the existence of proceedings; it may not take judicial notice of the truth of what is alleged in them. No petition, order or record from that cause was produced. I decline to find a breach of Clause 9.1(d) on that material. 7. Thirdly, cessation of business. The evidence is that the Plaintiff reduced admissions; the inspection of February 2026 found Staff on the premises and equipment in use in parts of the hospital. That falls short of ceasing or threatening to cease carrying on business. 8. As to the missing equipment, the position is more serious. The joint inspection of 10th February, 2026 records five categories of asset reported by the Plaintiff as stolen or lost, with no supporting documentation, and further assets simply not found. Clause 8.1 required the Plaintiff to notify the Lessor immediately in writing upon loss and to replace the item at its own cost. There is no evidence that it did either. The Plaintiff's answer — that insurance under Clause 7.1 covers the loss — misreads Clause 8.2, which makes the crediting of insurance proceeds conditional upon the Lessee having first complied with Clause 8.1. I find a breach of Clause 8.1 established. It is nonetheless right to record that the Plaintiff and the 3rd Defendant are in dispute as to whether two of those items were in fact collected by the 3rd Defendant in a previous exercise, and that dispute is not resolved on the material before me. ***Termination and the notices*** 1. The Plaintiff's construction argument must be addressed before its evidential one. 2. The Plaintiff contends that Clause 11.2 entitled it to ten days within which to remedy the default, and that Clause 17 required ninety business days' notice before the end of term. Both contentions confuse three distinct mechanisms in the agreement. Clause 11.1 permits the Lessor to terminate for breach of an essential term under Clause 9.1, and it prescribes no remedy period. Clause 11.2 permits termination for an event of default under Clause 10.1 and, where the default is capable of remedy, requires ten business days' written notice to remedy. Clause 17 governs the ordinary expiry of the term and has nothing to do with termination for breach. The Notice of 30th January, 2024 expressly terminated "pursuant to Clause 11.1" for breach of the essential term at Clause 9.1(a). The ten-day remedy period in Clause 11.2 was therefore not engaged, and neither was the ninety-day end-of-term machinery in Clause 17. 3. I would add that even had Clause 11.2 applied, its requirement was substantively satisfied: the Plaintiff had been given fourteen days by the letter of 6th September, 2023 and a further fourteen days by that of 28th November, 2023, which together far exceed ten business days. 4. Likewise, I reject the Defendants' converse submission that the issuance of notices was optional because Clauses 11.1 and 11.2 use the word "may". That is a misreading. The permissive word governs the Lessor's election whether to terminate at all; it does not make the notice dispensable. On the contrary, both Clauses provide that the Lessor "may give you notice terminating" the lease. Notice is the very instrument by which termination is effected. A lease is not terminated by an unexpressed intention. Had the 3rd Defendant genuinely believed notice to be optional, it is difficult to see why it took the trouble to write three of them. 5. That brings me to the real question, which is not whether notice was required but whether it was given. Here the Defendants' case runs into difficulty. 6. Clause 29.2 of the Master Lease Agreement provides that "Notices may be hand delivered, sent by pre-paid registered mail or by facsimile". Electronic mail is not among the stipulated modes. Each of the three letters relied upon bears the legend "Advance copy via email" followed by addresses at the Plaintiff's domain. Not one is accompanied by a transmission report, a delivery receipt, a printed extract of the sending mailbox, a certificate of posting, a courier receipt, or a signed acknowledgement of receipt. No witness deposed to having personally delivered any of them. DW1's evidence goes no higher than that the notices "had as a Courtesy been issued". 7. The Plaintiff's witness stated that the letters of 28th November, 2023 and 30th January, 2024 were never received and that no earlier correspondence was received either. That evidence was not tested by cross-examination, and I attach to it the reduced weight which untested evidence attracts. But that does not assist the Defendants, because the burden of proving service never lay on the Plaintiff. By Sections 107 and 109 of the Evidence Act, whoever asserts a fact must prove it; and it was the 3rd Defendant which asserted that it had served the notices upon which the validity of its termination depends. Section 112 reinforces the point: the manner and fact of dispatch were peculiarly within the 3rd Defendant's knowledge. 8. The authority which decides this point is the very authority relied upon by the Plaintiff. In *Mogo Auto Limited v. Otianga (Civil Appeal E036 of 2024) [2024] KEHC 13055 (KLR),* Aburili, J. was faced with a creditor which had produced copies of reminders and notices but no certificate of postage, no email and no other evidence of transmission. The learned Judge held that the burden lay on the creditor to demonstrate service in the absence of an admission by the debtor, and that in the absence of such proof the repossession fell to be set aside. The reasoning applies with full force here. 9. The Defendants urge that the Plaintiff's own witness spoke of "meetings and consultations", and ask rhetorically what those consultations concerned if not the default. There is something in the point, and I accept that the Plaintiff was aware in a general way that the 3rd Defendant asserted arrears — paragraph 8 of its own Plaint says as much. But awareness that a creditor claims arrears is not the same thing as receipt of a notice terminating a lease and demanding return of equipment within seven days. The contractual and statutory significance of the latter lies in the certainty it gives the debtor as to what is required and by when. General knowledge of a dispute cannot be substituted for it. 10. I find that the 3rd Defendant has not proved service of the demand notices of 6th September, 2023 and 28th November, 2023 or of the Notice of Lease Termination dated 30th January, 2024. ***The Movable Property Security Rights Act, 2017*** 1. The Plaintiff invokes Sections 65 to 67 of the Movable Property Security Rights Act, 2017. Section 4(1) applies the Act to security rights in movable assets, including "every transaction that secures payment or performance of an obligation, without regard to its form", and expressly enumerates the financial lease among the transactions caught. 2. Whether the present transaction is a financial lease within that provision is not free from difficulty. Pointing away from that characterization are the absence of any option to purchase, the Lessor's retention of a Residual Value interest, and the obligation in Clause 13 to return the assets in good working order at the end of the term. Pointing towards it are the absolute and unconditional payment obligation in Clause 4.6, which survives defect, breakdown, loss or damage; the allocation to the Lessee of every risk and indemnity under Clauses 8 and 16; and, most tellingly, Clause 11.3(d), which on termination renders the Lessee liable in liquidated damages for the discounted present value of the whole of the unpaid rentals for the balance of the term. A lease under which the Lessee bears all the risks and must in any event pay the whole of the rentals is, in substance, a financing of the asset secured by retention of title. 3. I need not decide the point, and I decline to do so, because the outcome is the same either way. If the Act applies, Section 67 required the 3rd Defendant to serve a notification stating the nature and extent of the default, the steps required to rectify it and the timelines, and the consequences of non-compliance — and, for the reasons already given, service was not proved. If the Act does not apply, the contractual notice under Clause 11.1 was required — and, for the same reasons, service was not proved. The Plaintiff succeeds on this issue on the narrow but sufficient ground of want of proof of service, not on the wider ground of statutory inapplicability of the parties' bargain. ***The proclamations of 26th March, 2024*** 1. Two of the three pleaded particulars of illegality fail. 2. The complaint that the Defendants ought to have filed suit and obtained a Court order before proclaiming is misconceived. Rule 6(1) of the Auctioneers Rules, 1997 applies Part III of those Rules to the attachment and sale of property "under warrants of Court and letters of instruction from third parties, including distress for rent and repossession". Repossession on a letter of instruction, without any Court order, is thus expressly contemplated. An owner of chattels who has a contractual right to retake them may do so, provided he acts peaceably and in accordance with the Rules. The law does not require a creditor to sue for what is already his. 3. The complaint that statements were not furnished also fails. The repayment schedules and the statement of the rental account were produced and were not challenged. 4. The first pleaded particular, however, together with matters apparent on the face of the documents, gives rise to real difficulty. 5. Rule 6(2) requires that a letter of instruction under Rule 6(1) "shall be in Sale Form 1 set out in the Schedule". The instruction here was the Collection/Repossession Order dated 22nd March, 2024, a letter on the 3rd Defendant's own letterhead. It is not in Sale Form 1. Rule 12(1) requires the auctioneer, on receipt of a Court warrant or letter of instruction, to record it in the register and to prepare a proclamation in Sale Form 2 "indicating the value of specific items and the condition of each". 6. The proclamations produced are on Sale Form 2, which is correct as far as it goes. But they are incomplete in material respects. The entries for "Auctioneers Fees" and "Total Amount Due" are blank. The schedules of movable property are handwritten and, in significant part, illegible; the columns for condition and estimated value are inconsistently completed. Given that Rule 12(1)(b) exists precisely so that a debtor may know what has been taken, in what condition and at what value, those omissions are not merely formal. 7. There is a deeper irregularity. The form on which the 2nd Defendant proceeded records a "Principal/Decretal Amount", certifies that the property is "duly attached/repossessed", and warns that at the expiry of seven days the property "will be removed to the auctioneers premises and sold by public auction". The Collection/Repossession Order authorized the 2nd Defendant "to collect a sum of KES 16,977,776 ... or otherwise take possession of the items listed below". The exercise was thus conducted, on its face, as an attachment of the debtor's goods for sale in satisfaction of a money claim. But there was no decree, and the goods were not the debtor's. The 3rd Defendant's entitlement was to recover its own chattels under Clauses 11.3(a) and 13, not to attach and sell the Plaintiff's property in satisfaction of a debt. Conflating the two is not a technicality: it exposed the Plaintiff to the threatened sale by public auction of equipment which, on the 3rd Defendant's own case, was never the Plaintiff's to sell, and it did so without the statement of account, condition and value which the Rules require. 8. Taking together the want of proof of service of the termination notice, the failure to instruct in Sale Form 1, and the defects in the proclamations themselves, I hold that the proclamations of attachment dated 26th March, 2024 were irregular and cannot stand. ***The 1st and 2nd Defendants*** 1. The 1st Defendant, NCBA Bank Kenya PLC, is not a party to the Master Lease Agreement. That agreement was made with NIC Leasing LLP, now NCBA Leasing LLP, a distinct legal person registered as a limited liability partnership. The 1st Defendant's only connection with these facts is that it held the Plaintiff's account No. 1005779185 and was the recipient of standing instructions to debit rentals. It neither owned the equipment nor terminated the lease nor instructed the 2nd Defendant. The Plaintiff pleaded, at paragraph 4 of the Plaint, that it "maintained a banking facility with the 1st defendant" — but no relief is sought which that averment can support, and prayer (c) of the Plaint, seeking to injunct the 1st Defendant from proclaiming and attaching, is directed at a party which did no such thing. The suit against the 1st Defendant discloses no cause of action and must be dismissed. 2. The 2nd Defendant acted on instructions. An auctioneer is nonetheless an officer of the Court and is not a mere post-box: as Aburili, J. observed in *Mogo Auto v. Otianga*, an auctioneer ought to satisfy himself that the requisite notice has been issued before attaching. Having proceeded on a letter of instruction not in the prescribed form, and having issued proclamations incomplete on their face, the 2nd Defendant cannot be heard to say the irregularity is none of its making. It is, however, appropriate to record that no relief in damages is sought against it and none is granted. ***Relief*** 1. The Plaintiff having succeeded in establishing that the proclamations were irregular, the question is what follows. In my judgment, considerably less than the Plaintiff seeks. 2. Prayer (b) asks for a permanent injunction restraining the Defendants "from demanding from the plaintiff in any way as regards to the debt herein". That is an extraordinary prayer. It would restrain a creditor in perpetuity from asking to be paid a debt which the debtor admits it owes. No Court could grant it. It is refused. 3. Prayer (c) asks that the 1st Defendant be injuncted from proclaiming and attaching any of the Plaintiff's property. The 1st Defendant has done nothing of the kind, and to the extent the prayer is read as directed at the 3rd Defendant it must equally fail, for three reasons. 4. The first is that the Plaintiff comes to equity in admitted breach. It is trite that a contracting party who fails to perform his part of the contract cannot obtain an injunction to restrain a breach of covenant by the other: *Kenya Breweries Ltd v. Okeyo [2002] 1 EA 109,* applied in *John Edward Ouko v. National Industrial Credit Bank Ltd [2013] eKLR*. So too in *Yusuf Abdi Ali Co Ltd v. Family Bank Limited [2015] eKLR,* where the Court held that a plaintiff which admitted its indebtedness had not made out a prima facie case with a probability of success. In *Mogo Auto v. Otianga* itself, the learned Judge, having set aside the repossession for want of notice, went on to set aside the permanent injunction, holding that the respondent "had come to Court with unclean hands and was not entitled to an equitable remedy" because she was in arrears. The same course is appropriate here. 5. The second is that the equipment belongs to the 3rd Defendant. An injunction restraining an owner indefinitely from recovering its own chattels from a bailee whose right of possession has ended would be an expropriation by decree. 6. The third is that the terms have in any event run their course. By the letter of 26th July, 2023 the Master Lease Agreement was extended to 15th July, 2025 in respect of Lease Schedules 009, 010 and 011, and to 15th August, 2025 in respect of Schedule 012; the earlier Schedules had shorter terms. Clause 13.1 obliges the Lessee, "at the expiration or earlier termination" of the renting, to deliver the assets in good working order. Even if the termination of 30th January, 2024 is set aside for want of proof of service — as it is — the Plaintiff's right to possession has since expired by effluxion of time. The Plaintiff's reliance on the automatic twelve-month extension in Clause 17.1 does not avail it, because that extension operates only "unless we otherwise notify you in writing", and the 3rd Defendant's written position from January 2024 onwards has been unmistakably to the contrary. 7. What the Plaintiff is entitled to is that the 3rd Defendant, if it wishes to recover its equipment through an auctioneer, should do so lawfully: on a fresh notice properly served in accordance with Clause 29.2, on a letter of instruction in Sale Form 1, and by proclamations complying with Rule 12 of the Auctioneers Rules. That is the measure of its success, and it is the form in which I shall grant relief. 8. Two matters I cannot deal with. The Defendants filed no counterclaim. They sought only the dismissal of the suit with costs. In the absence of a counterclaim, the Court cannot enter judgment for the arrears, cannot order delivery-up of the equipment, and cannot make any award in respect of the missing items. Those remain live matters between the parties and I say nothing which forecloses them. Discharging the interim orders restores the parties to their contractual positions, which is as far as this suit permits me to go. ***Costs*** 1. Costs follow the event under Section 27 of the Civil Procedure Act, but the event here is divided. The Plaintiff has failed on its central allegations: it did not own the equipment, it was in admitted breach, and its case that the machines belonged to Jamii Bora Leasing Limited was advanced without evidence and then quietly abandoned. It obtained interim relief on that footing and has enjoyed the use of the 3rd Defendant's equipment for the two years since. On the other hand, it has established that the process by which its premises were proclaimed in March 2024 was irregular, and a litigant who demonstrates that an enforcement process was unlawful has vindicated something of value. 2. The 1st Defendant was joined without cause and should not be out of pocket. As between the Plaintiff and the 2nd and 3rd Defendants, and following the course taken in Mogo Auto v. Otianga, I consider that each party should bear its own costs. **H. DISPOSITION** 1. For the reasons given, I enter judgment as follows: 2. *A declaration that the 3rd Defendant, NCBA Leasing LLP (formerly NIC Leasing LLP), is the owner of the medical equipment supplied to the Plaintiff under the Master Lease Agreement dated 9th August, 2018 and the Lease Schedules numbered NLLLP/MHFCL/001 to 012, and that the Plaintiff held and holds the same as bailee with a contractual right of use only.* 3. *A declaration that the Plaintiff was in breach of Clause 9.1(a) of the Master Lease Agreement by failing to pay the lease instalments when due and owing to the leasing company.* 4. *A declaration that the 3rd Defendant has not proved service upon the Plaintiff of the demand notices dated 6th September, 2023 and 28th November, 2023 or of the Notice of Lease Termination dated 30th January, 2024, and that the said Notice of Lease Termination is accordingly ineffective.* 5. *A declaration that the Proclamations of Attachment/Repossession of Movable Property dated 26th March, 2024 were irregular, and the same are hereby set aside.* 6. *that the prayer for a permanent injunction restraining the Defendants from demanding payment of the sums due under the Master Lease Agreement is declined.* 7. *that the prayer for an injunction restraining the Defendants from proclaiming or attaching the Plaintiff's property is refused, save that the 3rd Defendant shall not repossess the equipment otherwise than in accordance with order 8 below.* 8. *That the interim orders granted herein on the institution of this suit are discharged.* 9. *That the 3rd Defendant is at liberty to recover possession of its equipment upon (a) service upon the Plaintiff of a fresh notice of termination and demand for return, served in one of the modes prescribed by Clause 29.2 of the Master Lease Agreement and in a manner capable of proof; (b) the issuance of a letter of instruction in Sale Form 1 as required by Rule 6(2) of the Auctioneers Rules, 1997; and (c) proclamation in Sale Form 2 complying in full with Rule 12(1) of the said Rules, including the indication of the value and condition of each item.* 10. *That for the avoidance of doubt, and no counterclaim having been filed, no order is made for payment of the outstanding rentals, for delivery-up of the equipment, or in respect of the equipment recorded as lost, stolen or not found, and the parties' respective rights and remedies in those respects are reserved.* 11. *That the suit against the 1st Defendant, NCBA Bank Kenya PLC, is dismissed with costs to the 1st Defendant.* 12. *That as between the Plaintiff and the 2nd and 3rd Defendants, each party shall bear its own costs of the suit.* 13. *That either party is at liberty to appeal.* It is so ordered. **DATED, SIGNED AND DELIVERED AT ELDORET THIS 31ST DAY OF AUGUST 2026** **……………………………..…………….** **R. NYAKUNDI** **JUDGE**