[2021] KEBPRT 79 (KLR)

REPUBLIC OF KENYA

BUSINESS PREMISES RENT TRIBUNAL

TRIBUNAL CASE NO E355 OF 2021 (NAIROBI

HURLINGHAM GROCERS LIMITED…………....…….…………………..TENANT

VERSUS

APA INSURANCE LIMITED…………………….…….…………………LANDLORD

RULING

1. Through a motion dated 28th July 2021, the Tenant is seeking for six (6) reliefs. Prayers 1, 2, 3 and 5 were granted ex-parte and are therefore spent.

2. Through prayer 4, the Tenant is seeking for an order that the Landlord gives an account of sale by public auction of the goods proclaimed vide a proclamation dated 11th August 2020 by Eastern Auctioneers.

3. The Tenant is also seeking for costs of the application through prayer 6.

4. The application is supported by the affidavit of Firozali Akbarali Kassam Jaffer, a Director of the Tenant who deposes that it was a Tenant in the Landlord’s premises situate on L.R. No 209/377/11, 12 and 13 (APA Arcade) along Argwings Kodhek Road.

5. It is the Tenant’s case that there was a dispute between it and the Landlord over rent increase vide BPRT 664/2015 and BPRT 27/2018 pursuant to which rent was assessed by this Tribunal. An appeal vide ELC 029 of 2020 was preferred but was still pending for hearing and determination.

6. On 11th August 2020,the Landlord proclaimed the Tenant’s goods and subsequently broke into the premises and carried away the properties. The shop was thereafter closed.

7. It is the Tenant’s case that he has not been supplied with a statement of his rent account despite various attempts to procure the same from the Landlord. He was never served with notice of termination of tenancy under Cap 301, Laws of Kenya.

8. It is against the foregoing background that the Tenant approached this Tribunal with the instant application. The Tribunal restrained the Landlord from evicting or locking the premises and further ordered it to reopen the same with the OCS Kilimani Police Station enforcing compliance.

9. The application is opposed through a replying affidavit of Rovina Koske, a Legal Officer of the Respondent Company who deposes that on 5th July 2019, the Respondent obtained an order in Tribunal Case No 664of 2015 to increase monthly rent to Kshs 135,809/- VAT exclusive with effect from 1st November 2015 in terms of annexture “RRK – 1”.

10. The Tenant failed to comply with the order whereupon a demand was made on 1st August 2019 for Kshs 4,224,295/- in rent arrears. As a result, the Tenant applied for leave to appeal against the rent increase and a stay of execution vide Nairobi ELC Misc Application No. 180 of 2019 and ruling thereon was delivered on 20th July 2020 directing the Tenant to pay monthly rent as ordered by the Tribunal.

11. To date, the Tenant’s appeal vide ELC Appeal No. E029 of 2021 is still pending unprosecuted. A further demand for Kshs 5,653,892/36 was made on 29th July 2020 without any response by the Tenant.

12. As a result, the Landlord set into motion necessary legal process to levy distress for rent in arrears. The Applicant thereafter locked up the premises and disappeared.

13. Owing to the said closure, the Auctioneers gained access under police supervision and the Tenant’s goods were carted away. The premises were handed over to the Landlord.

14. The Tenant’s goods were sold by auction and according to the Landlord, the proceeds fell short of even meeting Auctioneer’s fees and the debt remained unpaid. An account for the sale is contained in annexture “RK6”.

15. The said auction took place on 19th December 2020 and the amount realized was Kshs 107,700/- from the sale.

16. Thereafter, the Tenant is said to have abandoned the premises for several months and the Landlord continued to lose revenue in form of rental income and on 7th April 2021, a request for formal handing over was made to the Tenant’s Advocates vide annexture “RK – 7”.

17. No response was made to the request and it was clear that the Tenant was not interested in the premises and the Landlord decided to take in another Tenant to whom it issued an offer dated 14th May 2021 marked “RK – 8”.

18. The new Tenant took over the premises on or about May 2021 and commenced business therein. As such, there was no longer any Landlord/Tenant relationship.

19. In view of the foregoing, the Landlord denies that it acted illegally contending that after the Tenant abandoned the suit premises, it had to mitigate its losses.

20. The Landlord deposes that it regularly supplied the Tenant with rent account statements through its lawyers without any requests.

21. Based on the foregoing facts, the Landlord filed a motion dated 3rd September 2021 seeking for stay of the orders of 29th July 2021 and setting aside, discharge or vacation of the orders given on 7th May 2020.

22. The application is supported by the affidavit of Rovina Koske sworn on even date stating inter alia that the orders were obtained through outright, deliberate falsehoods, misrepresentations and concealment of material facts by the Tenant.

23. The Landlord reiterates that there is no Landlord/Tenant relationship with the Applicant herein who abandoned the suit premises in December 2020.

24. The Landlord has further exhibited a letter of offer dated 14th May 2021 between Lloyd Masika Limited and Hurlingham Hardware and Supplies Ltd which is duly executed by both parties in respect of the suit premises.

25. I have not seen any replying affidavit by the Tenant in regard to the said application.

26. On 26th August 2021, this Tribunal inter alia directed its Rent Inspector to visit the suit premises at the cost of the Tenant for purposes of establishing its current status.

27. The said visit took place on 1st October 2021 and it was found that there was no grocery in operation and the premises had hardware materials which were not yet arranged by the time of the visit, some photographs taken therefrom were filed together with the report.

28. I am now required to determine the following issues;

a. Whether there is a Landlord/Tenant relationship in existence between the parties herein.

b. Whether the Tenant is entitled to the orders sought in the application dated 28th July 2021.

c. Whether the Landlord is entitled to the orders sought in the application dated 3rd September 2021.

d. Who is liable to pay costs of the proceedings?

29. It is not in dispute that the parties herein were Tenant and Landlord respectively. Sometimes on 1st December 2020, the Landlord distressed for rent arrears amounting to Kshs 6,201,282/36/- against the Tenant.

30. The goods attached were sold by public auction on 19th December 2020 and only realized a sum of Kshs 107,700/- as per the Landlord’s annexture “RK – 6”. The said amount was not sufficient to cover auctioneer’s fees.

31. There is no evidence that after the said distress, the Tenant ever went back or restocked the shop to continue with business neither is there evidence of payment of any rent by it to the Landlord.

32. The Rent Inspector’s report confirmed that the Tenant was not in occupation of the premises and a third party had kept hardware materials inside thereby corroborating the Landlord’s contention that the Landlord/Tenant relationship had been brought to an end through the parties own conduct.

33. It is curious to note that after being confronted with a replying affidavit and the Landlord’s application dated 3rd September 2021, the Tenant did not file any affidavits to controvert the depositions made by the Landlord.

34. In such circumstances, there is no basis to disbelieve the Landlord that the relationship had come to an end. This being so, this Tribunal would no longer have jurisdiction since the relationship had been brought to an end before the proceedings were instituted on 28th July 2021. Indeed, the letter of offer for the suit premises attached to the application dated 3rd September 2021 as annexture “RK – 1(g)” is dated 14th May 2021.

35. I therefore agree that the orders given in favour of the Tenant on 29th July 2021 were obtained though concealment of material facts by the Tenant.

36. In the case of Gabriel Kariuki Gitonga and 2 others –Vs- Redken Wells Ltd and 11 others (2021) eKLR, the Court cited with approval the dicta in the King versus the General Commissioner for the purposes of Income Tax Acts for the District of Kensington ex-parte Princess Edmond De Pligac (1917) IKB 486 per Warrington L.J at paragraph 9 as follows;

“It is perfectly well settled that a person who makes an ex-parte application to the court that is to say, in the absence of the person who will be affected by that which the court is asked to do, is under an obligation to the court to make the fullest possible disclosure of all material facts within his knowledge and if he does not make that fullest possible disclosure, then he cannot obtain any advantage from the proceedings and he will be deprived of any advantage he may have already obtained by him. That is perfectly plain and requires no authority to justify it.”

37. In view of the foregoing analysis, it should by now be clear that the Tenant/Applicant was not entitled to the orders that were made in its favour. On the other hand, I am convinced beyond any peradventure that the Landlord is entitled to an order for setting aside the ex-parte orders made against it.

38. There being no existing Landlord/Tenant relationship between the parties herein, this Tribunal had no jurisdiction to entertain the instant proceedings and the suit was incompetent from the date of inception.

39. In the premises, the following orders commend to me;

a. The application dated 28th July 2021 is hereby dismissed as well as the reference.

b. The orders given ex-parte on 29th July 2021 are hereby discharged and vacated.

c. The Landlord’s application dated 3rd September 2021 is allowed in terms of order (b) above.

d. Costs of the two applications and the reference assessed at Kshs 50,000/- are awarded to the Landlord.

HON. GAKUHI CHEGE

VICE CHAIR

BUSINESS PREMISES RENT TRIBUNAL

Ruling dated, signed and delivered this 10thday of December 2021 virtually in the presence of Kinyua for the Tenant and Ochieng for the Landlord.

HON. GAKUHI CHEGE

VICE CHAIR

BUSINESS PREMISES RENT TRIBUNAL