[2022] KEHC 10222 (KLR)

Juma & another (Suing as the Administrators of the Estate of Juma Muchemi) v William & Kennedy Limited & another (Civil Suit 2459 of 1997) [2022] KEHC 10222 (KLR) (Commercial and Tax) (8 July 2022) (Ruling)

Neutral citation: [2022] KEHC 10222 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Commercial Courts Commercial and Tax Division)

Commercial and Tax

Civil Suit 2459 of 1997

A Mshila, J

July 8, 2022

Between

Mary Wanjiku Juma

1st Applicant

Joyce Ngoiri Muchemi

2nd Applicant

Suing as the Administrators of the Estate of Juma Muchemi

and

William & Kennedy Limited

1st Defendant

Official Receiver and Provisional Liquidator Rural Urban Credit Finance Ltd (In Liquidation

2nd Defendant

Ruling

Background 1. The Notice of Motion is dated October 25, 2021was brought under the provisions of Order 40 Rules 1 and 2 of the Civil Procedure Rules; The Application was supported by the sworn Affidavit of Mary Wanjiku Jumawho sought for orders that;a.The defendant by itself, its agents and/or servants be restrained from constructing and/or continuing with any construction and/or materially altering the character of land parcels L.R 5989/5,66,67,68 and 91 pending the hearing and determination of this Application.b.The defendant by itself, its agents and/or servants be restrained from constructing and/or continuing with any construction and/or materially altering the character of land parcel L.R 5989/5,66,67,68 and 91 pending the hearing and determination of this suit.c.Costs of the Application be provided for.

2. The applicant stated that to pre-empt the effect of the anticipated judgment and in order to ingratiate itself on the land irretrievably and alter the character of the suit premises the 1st defendant/respondent has commenced construction of buildings on the suit premises. Unless injuncted any orders made in the future will be rendered nugatory.

3. The 1st respondent in responding to the Application filed grounds of opposition dated November 22, 2021 as follows;a.The Application is frivolous, misconceived, scandalous, vexatious and a total abuse of this court's process.b.The Application is yet another belated attempt to cause unreasonable delay to the determination and conclusion of the suit herein filed in the year 1997, twenty-four (24) years ago and is yet to be concluded contrary to the Overriding Objectives as provided for under section 1A, 1B, 3A and 3B of the Civil Procedure Act.c.The present Application is a belated attempt by the plaintiff/applicant to vary the Consent Orders recorded on July 12, 2000to wit the 1st defendant to remain in possession of the suit property.d.The present Motion seeks to cause inordinate delay in the hearing and determination of the suit herein having been filed twenty-one (21) years after the Consent Order was recorded.e.The 2nd defendant is the bona fide registered owner of the suit property with proprietary rights enshrined under article 40 of the Constitution and has the right to use the suit property as it deems fit.f.There is no explanation justifiable, plausible or otherwise discernible from the Application dated October 25, 2021to compel the Court to grant the orders sought.g.The orders sought by the applicant cannot be granted as the same is tantamount to this Court reviewing its own orders in the absence of a formal application for review.h.The plaintiff/applicant has not established a prima facie case or any case at all with a probability of success against the 1st defendant/respondent herein as set out in the case of Giella vs. Cassman Brown to warrant grant of the Orders sought.i.There is no explanation justifiable or otherwise for the inordinate delay in filing the present Application.j.Damages (if any) awardable would be an adequate remedy.k.The balance of convenience tilts in favour of refusal of the orders sought rather than grant of the same.l.On the aforementioned grounds, the 1st defendant/respondent shall seek for dismissal limine of the plaintiff s/applicant's Notice of Motion dated October 25, 2021 with costs.

applicant’s Case 4. A dispute arose between the parties to this case with regard to the aforementioned parcel of Land. The plaintiff/ applicant had purchased the property at purchase price of Kenya Shillings Thirty Million in year 1993. The proceedings in this case which pertain to the parcel of Land-Land Parcel L.R 5989/5,66,67,68, and 91 were instituted in 1997 and the matter is presently part-heard wherein the plaintiff/applicant testified and closed his case prior to his demise in December 2018.

5. The matter has been fixed for Defence Hearing as per directions of the court. However, the beneficiaries of the deceased who are the present applicants in the matter have taken notice that the defendants have began construction works on the suit property. This has necessitated this instant Application to maintain ‘status quo’ and restrain the defendant/respondents from continuing with any construction works on the property pending final determination of the case by this court.

6. It was the applicant’s submission that a prima facie case has been established by the fact that the respondent/defendants have an intent to defeat the arm of justice by substantially changing the character of the suit property caused by the current ongoing construction on the premises. The construction on the property is so substantial and is aimed at pre-empting the effect of the anticipated final judgment of this court. The same ought to be put to a stop and the rights of the parties therein safeguarded by this court.

7. The applicant submitted that she herein stands to suffer substantial damage which cannot be compensated by damages if the injunction as against the respondents is not granted. The plaintiff purchased this property in 1993 and to date the applicants are yet to enjoy the full benefits of the suit property to which they are entitled under the law. The applicant has waited for more than 30 years for this matter to be heard.

8. Therefore, a great injustice will occur if the respondents are not estopped from construction on the land which building works will substantially alter the character of the land.

9. In the applicant’s affidavit sworn by Mary Wanjiku Juma, the applicant provided evidence in the form of photographs proving that a significant construction project is ongoing on the Land in dispute. The nature of the construction is so substantial that it will change the character of the property. The respondent has not refuted these facts on the construction process by way of Replying Affidavit therefore it ought to be restrained from these actions and ‘status quo’ on the property maintained.

10. On a balance of convenience, the applicant submitted that the respondent/defendants will not suffer any loss if they maintain status quo on the property pending Defence hearing of the matter and delivery of judgment.

11. It was the applicant’s case that all the three conditions for injunction have been met and that the court in the exercise of its discretion should grant the orders sought by the plaintiff/applicant herein.

respondents’ Case 12. In response it was the 1st respondent’s submission that the applicants have not established a prima facie case with a probability of success for the reasons that;a.There is already in place a Consent Order for maintenance of Status Quo pending the hearing and determination of the present suit, which order was made on July 12, 2000. b.Parties herein, Juma Muchemi (now deceased) and the 1st defendant/respondent voluntarily and willingly entered into the said Consent, which Order has been in force for twenty-two (22) years now.c.The Parties also consented to the 1st respondent being in possession of the suit property pending the hearing and determination of the suit herein.d.The 1st respondent has not violated any of the Orders made by Consent on July 12, 2000.

13. The applicants have neither demonstrated any irreparable harm nor proved that the defendant/respondent is not capable of compensating her should this Court in the most unlikely event make an Order for Compensation of damages. The subject matter of the proceedings herein is land, whose value can be ascertained through the valuation of the same.

14. Further, the 1st defendant/respondent is a Company that has been in operation for a period of over (30) years with vast assets and is capable of compensating the plaintiff/applicant, in the unlikely event that this Court awards damages.

15. The 1st respondent argued that the applicants have not met the 1st and 2nd threshold, the balance of convenience therefore tilts in favour of the 1st respondent.

16. The 2nd respondent submitted that the purchases of shares in the 2nd defendant Company from the previous shareholders were financed by the 2nd defendant/respondent before it was placed under liquidation. The suit property, L.R. No. 5989/5 I.R. No. 35802, was the only asset of the 1st defendant/respondent which was being purchased though purchase of shareholding. The 1st respondent’s current majority shareholder, Mr. Nganga Gicharu, was at the said time the General Manager of the 2nd defendant. He is the person on whose behalf the suit property was being purchased. It is not in dispute that the 2nd defendant financed the said purchase and was to be registered as Chargee for the sums borrowed to finance the sale.

17. In light of the above, the 2nd respondent submitted that the actions of the 1st defendant against the 2nd defendant and continued fraudulent activities over the suit property warrants an order of injunction to preserve the status of the title and the physical status of the suit property.

18. Further, the 1stdefendant/respondent did not seek consent from the 2nd defendant/respondent to deal with the property in the manner in which it has dealt with the same over the years including the transaction leading to the filing of this suit. It is in the interest of justice and public interest that the suit property be preserved pending the hearing and determination of the suit. The 1st defendant/respondent has no other known property capable of being attached to recover public funds applied to purchase shares in the 1st defendant/respondent.

19. The 2nd respondent urged the court to restrain all the parties herein from interfering with the status of the title and physical state of the suit property pending herein and determination of the suit.

Issues for Determination 20. The Application, response and the written submissions have been well considered and the issues for determination are;a.Whether the consent recorded in the suit estopped the applicant from seeking an injunction?b.Whether the applicant has satisfied the conditions for grant of an injunction?

Analysis Whether the consent recorded in the suit estopped the applicant from seeking an injunction; 21. The applicant seeks an injunction to restrain the 1st respondent from constructing and/or continuing with any construction and/or materially altering the character of land parcel L.R 5989/5,66,67,68 and 91 pending the hearing and determination of this suit.

22. The 1st respondent argued that the present Application is a belated attempt by the plaintiff/applicant to vary the Consent Orders recorded on July 12, 2000 to wit the 1st defendant to remain in possession of the suit property.

23. The consent order has been captured in the court proceedings of July 12, 2000 as follows;“By consent: -1. The defendant judgment be and is hereby set aside.2. defendant to file Defence out of time.3. defendant to pay throw away costs to plaintiff to be agreed or taxed.4. Draft Defence deemed duly filed and served upon payment of the court fees within 7 days of this order.5. plaintiff at liberty to file Reply to Defence within 15 days of today.6. Hearing of all the interlocutory applications pending to be dispensed and status quo be maintained pending hearing of the suit – status quo being that defendant is in possession of his property.7. defendant not to alienate suit properties in any way pending hearing the suit.8. Liberty to either party to apply.”

24. From the above excerpt it is the Court’s understanding that the status quo on the property was to be maintained pending the hearing and determination of the suit herein. The Court also stated categorically that the status quo was that the defendant is in possession of his properties.

25. The court has also considered the evidence on record with respect to the plaintiff/applicants application. The court has noted that the 1st respondent did not categorically deny that it was undertaking construction as shown in the photographic evidence. It was simply stated that the Application is an attempt by the plaintiff/applicant to vary the Consent Orders recorded on July 12, 2000 to wit the 1st respondent to remain in possession of the suit property.

26. Being that the 1st respondent has not disputed that it has commenced construction of buildings on the suit premises; this is a clear violation of the Consent Order stated herein above and the status quo that was to be maintained on the suit property. It is this violation that has necessitated the filing of the present Application.

27. This court is satisfied that the Consent recorded in the suit does not estop the applicant from seeking the injunctive orders.

Whether the applicant has satisfied the conditions for grant of an injunction? 28. The conditions for the grant of temporary injunctions are well established and set out in the locus classicus case ofGiella vs. Cassman Brown(1973) EA 358 as follows:“The conditions for the grant of interlocutory injunction are now; I think, well settled in East Africa. First, an applicant must show a prima facie case with a probability of success. Secondly, an interlocutory injunction will not be normally granted unless the applicant might otherwise suffer irreparable injury which would not adequately be compensated by an award of damages. Thirdly, if the Court is in doubt, it will decide an application on the balance of convenience.”

29. The first condition that the plaintiffs herein must satisfy is that there is a prima facie case with a probability of success. In the case ofMrao v First American Bank of Kenya Limited & 2others (2003) KLR 125, “a prima facie case” was described as follows: -“A prima facie case in a civil application includes but is not confined to a “genuine and equitable case.” It is a case which, on the matter presented to the court, a tribunal properly directing itself, will conclude that there exists a right which has apparently been infringed by the opposite party as to call for explanation or rebuttal from the latter.”

30. It is clear that the 1st respondent disturbed the status quo and is altering the character of the suit premises by commencing construction of buildings on the suit premises. The applicant has thus established a prima facie case being that the said construction on the property goes against the court order requiring the status quo to be maintained pending the determination of this suit.

31. The second condition is that the applicant would suffer irreparable injury which cannot be adequately compensated by an award of damages. In Pius Kipchirchir Kogo v Frank Kimeli Tenai(2018) eKLR the court defined ‘irreparable injury’ and ‘balance of convenience’ as follows:“irreparable injury means that the injury must be one that cannot be adequately compensated for in damages and that the existence of a prima facie case is not itself sufficient. The applicant should further show that irreparable injury will occur to him if the injunction is not granted and there is no other remedy open to him by which he will protect himself from the consequences of the apprehended injury…The meaning of balance of convenience in favor of the plaintiff is that if an injunction is not granted and the suit is ultimately decided in favor of the plaintiffs, the inconvenience caused to the plaintiff would be greater than that which would be caused to the defendants if an injunction is granted but the suit is ultimately dismissed. Although it is called balance of convenience it is really the balance of inconvenience and it is for the plaintiffs to show that the inconvenience caused to them would be greater than that which may be caused to the defendants. Should the inconvenience be equal, it is the plaintiffs who suffer. In other words, the plaintiffs have to show that the comparative mischief from the inconvenience which is likely to arise from withholding the injunction will be greater than which is likely to arise from granting it.”

32. The applicant argued that she herein stands to suffer substantial damage which cannot be compensated by damages if the injunction as against the respondents is not granted. The Court is of the view that applicant has not demonstrated the irreparable harm that she will suffer that cannot be compensated by damages apart from stating that the construction on the suit property will substantially alter the character of the land.

33. The question that then follows is where does the balance of convenience lie? In the case of Paul Gitonga Wanjau v Gathuthis Tea Factor Company Ltd & 2 others (2016) eKLR, the court dealing with the issue on balance of convenience expressed itself thus: -“Where any doubt exists as to the applicants’ right, or if the right is not disputed, but its violation is denied, the court, in determining whether an interlocutory injunction should be granted, takes into consideration the balance of convenience to the parties and the nature of the injury which the respondent on the other hand, would suffer if the injunction was granted and he should ultimately turn out to be right and that which injury the applicant, on the other hand, might sustain if the injunction was refused and he should ultimately turn out to be right... Thus, the court makes a determination as to which party will suffer the greater harm with the outcome of the motion. If applicant has a strong case on the merits or there is significant irreparable harm, it may influence the balance in favour of granting an injunction. The court will seek to maintain the status quo in determining where the balance on convenience lies.”

34. The respondent herein is in possession of the suit property and does not stand to suffer any loss. Therefore, the balance of convenience would in any event tilt in favour of the applicant.

35. The purpose of an injunction is to maintain the status quo pending the hearing and determination of the matter before it. In the case of Assanand v Pettitt [1989] KLR 241 Hancox J cited with approval the holding in Cotton, L J in Preston v Luck (1884) 27 ChD at pg.505“to keep things in status quo, so that, if at the hearing the plaintiffs obtain a judgment in their favour, the defendants will have been prevented from dealing in the meantime with the property in such a way as to make that judgment ineffectual.”

36. From the material provided in the form of the photographic evidence and the admissions of the 1st respondent this court finds that the 1st respondent is indeed undertaking construction on the suit property during the pendency of this suit; and this court is also satisfied that the conditions for granting of an injunctive orders have been established by the applicant. The Court finds that this is a suitable case to exercise its discretion and is thus inclined to grant the injunctive orders sought.

Findings and Determination 37. In the light of the foregoing this court makes the following findings and determinations;a.This court finds that the applicants have satisfied the conditions for the granting of an injunctive orders;b.The application is merited and the application is hereby allowed;c.The defendant by itself, its agents and/or servants be and are hereby restrained from constructing and/or continuing with any construction and/or materially altering the character of land parcel L.R 5989/5,66,67,68 and 91 pending the hearing and determination of this suit;d.Costs shall be in the cause.Orders Accordingly.

DATED, SIGNED AND DELIVERED ELECTRONICALLY AT NAIROBI THIS 8TH DAY OF JULY, 2022. HON. A. MSHILAJUDGEIn the presence of;Wachira holding brief for Mutiso for the plaintiffGituru holding brief for Njuguna for the 1st defendantJasmin------------------------Court Assistant