[2022] KEBPRT 856 (KLR)

Lasky Investment Limited v Pyrethrum Processing Company Ltd & another (Tribunal Case E041 of 2022) [2022] KEBPRT 856 (KLR) (Civ) (8 November 2022) (Ruling)

Neutral citation: [2022] KEBPRT 856 (KLR)

Republic of Kenya

In the Business Premises Rent Tribunal

Civil

Tribunal Case E041 of 2022

Andrew Muma, Vice Chair

November 8, 2022

Between

Lasky Investment Limited

Tenant

and

Pyrethrum Processing Company Ltd

Landlord

and

Bonnkam Ventures Limited

Agent

Ruling

A. Parties and Representatives 1. The applicant Lasky Investment Limited is the alleged tenant and had rented space on the Suit Property Nakuru Municipality Block 11/95 House No. 177 for the business. (hereinafter known as the ‘tenant’)

2. The firm of Munene Chege & Company Advocates represent the tenant/applicant in this matter. wachirawaiganjo16@gmail.com

3. The 1st respondent Pyrethrum Processing Company Ltd is the landlord and rented out space for the business in the suit property to the tenant (hereinafter the “landlord”)

4. The 2nd respondent Bonnkam Ventures Limited are the alleged agents for the 1st Respondent and manage the Suit Property.

5. The firm of Mukite Musangi & Co. Advocates represent the Respondents in this matter. mmcnakuru@mmclaw.org

B. The Dispute Background 6. The Tenant has filed a reference and a notice of motion application dated March 24, 2022 under section 12 (4) of the Landlords and Tenants (Shops, Hotels and Catering) Establishments Act cap 301. The Tenant was seeking that this honourable tribunal grants orders restraining the Landlord from harassing, trespassing, evicting and interfering with the quiet possession by the tenant pending the hearing and determination of this matter.

C. The Tenant’s Claim 7. The tenant filed a reference and a notice of motion application dated March 24, 2022 to which he obtained interim reliefs on March 25, 2022.

D. The Landlord’s Claim 8. The Landlord has filed a replying affidavit dated May 31, 2022 as well as a preliminary objection dated May 31, 2022 questioning the Jurisdiction of the Tribunal on the grounds that they do not have a tenancy relationship with the alleged tenant.

E. List of Issues for Determination 9. It is the contention of this tribunal that the issues raised for determination are as follows;I.Whether there exists a tenancy relationship between the tenant and the landlord and if so whether the tribunal has jurisdiction to determine the matter?

F. Analysis and Findings Whether there exists a Tenancy Relationship between the Tenant and the Landlord? 10. Section 12 (4) of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Actchapter 301 Laws of Kenya provides that;“In addition to any other powers specifically conferred on it by or under this Act, a Tribunal may investigate any complaint relating to a controlled tenancy made to it by the landlord or the tenant, and may make such order thereon as it deems fit”

11. The above provision allows the Business Premises and Rent Tribunal to in addition to the powers conferred upon it by the Act investigate on any other matters that may be raised in relation to a controlled tenancy.

12. The Landlord and Tenant (Shops, Hotels and Catering Establishments) Actchapter 301 Laws of Kenya Act at section 2 defines a controlled tenancy as;a tenancy of a shop, hotel or catering establishment—(a)which has not been reduced into writing; or(b)which has been reduced into writing and which—(i)is for a period not exceeding five years; or(ii)contains provision for termination, otherwise than for breach of covenant, within five years from the commencement thereof;

13. In the present case, the tenant alleges that in December 2021 they rented out the suit property from the Landlord and paid for the deposit, rent for the month of January 2022. That thereafter they locked the premises intending to move in and the landlord has since been interfering with the same by breaking the padlocks to the premises.

14. The Landlord has filed a preliminary objection questioning the authority of the tenant to file the suit on the grounds that they have not presented documentation evidencing their incorporation and resolutions to file the matter in court.

15. Additionally, they have provided before this Tribunal that the premises in question are residential and not commercial and as such they do not fall within the ambit of the Tribunal.

16. I have perused the documents presented before this tribunal and several issues are noteworthy in an attempt to answer the question on Jurisdiction.

17. The tenant has annexed the alleged lease agreement dated November 1, 2021. An examination of the Lease shows that the Lease was executed by the tenant and the agents. The Landlord has provided in their replying affidavit that they entered into an agency agreement with the agent which governs the scope of their relationship.

18. At Clause 4. 7 the agreement provides thatThe agent shall ensure that all new tenants sign the lease or tenancy documents before occupying the company’s premises between the company, agent and the lessee and in presence of a witness.

19. The tribunal construes this to mean that before a tenant occupies the premises for which an agent has identified the tenant, the agreement must be signed by the tenant themselves, the landlord and the agent. The agreement annexed by the Tenant has not been signed by the landlord which then puts to question the validity of the said agreement.

20. In addition, the Landlord has annexed another version of the agreement which has a section on which the landlord was supposed to execute.

21. The tribunal also takes note of the fact that the lease agreement annexed by the landlord and the one annexed by the tenant are substantively different in terms of clauses such as that of the Use. The one annexed by the landlord provides the Use as residential while that of the tenant provides that the tenant shall not be restricted as to the scope of use. I find that the use is residential.

22. Accordingly, the tribunal puts to question the validity of the Lease signed by the agent and the tenant. The agent is supposed to act in the interest of the Landlord. The fact that the Agent has signed the agreement is not sufficient to uphold the existence of the tenancy. As per the certificate of lease annexed by the landlord, they landlord is the registered proprietor of the property and as such without his signature the tenancy does not sufficiently exist. The agent cannot purport to give what he does not own.

23. The tribunal also takes note of the fact that through a letter dated November 8, 2021 the landlord expressly communicated to the agent and informed them not to rent out the house until they are advised accordingly. By them proceeding to rent out the said premises, they acted ultra vires to their authority and contrary to the agency agreement.

24. In light of the foregoing, this tribunal cannot establish an existing tenancy relationship between the landlord and the tenant. Despite the fact that the tenant has been paying rent, the same was paid to the agent who did not have the authority to bind the landlord in the tenancy agreement. As such the tribunal holds that it is not clothed with Jurisdiction to entertain the matter and must therefore down its tool.

G. Ordersa)The upshot is that the landlord’s preliminary objection dated May 31, 2022 is upheld.b)The tenant’s reference and application dated March 24, 2022 are dismissed.c)The landlord shall have costs.

HON A. MUMAVICE CHAIRBUSINESS PREMISES RENT TRIBUNALJudgment dated, signed and delivered virtually by Hon A. Muma this 8th day of November 2022 In the presence of Makora for the Landlord and Wairimu for the Tenant.HON A. MUMAVICE CHAIRBUSINESS PREMISES RENT TRIBUNAL