[2022] KEBPRT 879 (KLR)

M Dalmar Trading Company Ltd v Gakibe (Tribunal Case E734 of 2022) [2022] KEBPRT 879 (KLR) (Civ) (16 December 2022) (Ruling)

Neutral citation: [2022] KEBPRT 879 (KLR)

Republic of Kenya

In the Business Premises Rent Tribunal

Civil

Tribunal Case E734 of 2022

Gakuhi Chege, Vice Chair

December 16, 2022

Between

M Dalmar Trading Company Ltd

Tenant

and

Mary Wambui Gakibe

Landlord

Ruling

1. The applicant herein moved this tribunal vide a reference dated August 17, 2022 pursuant to section 12(4) of cap 301, laws of kenya complaining that the landlord was illegally and unprocedurally interfering with its business on LR No 36/V11/435, Eastleigh, Nairobi without any colour of right. It further complained that the landlord had threatened to evict him from the suit premises without any due process of law and that it would incur daily loss as a result of the landlord’s conduct.

2. The tenant simultaneously filed a motion of even date seeking for interim orders of injunction pending hearing of the application, the complaint and Case No BPRT E799 of 2021.

3. According to the affidavit in support of the application and the grounds set out on the face thereof, the landlord invaded the tenant’s business premises on August 10, 2022 and threatened to evict it. The tenant has been paying Kshs 100,000/- per month as rent to the landlord without fail and had no arrears.

4. The tenant deposes that it had invested all its resources on the said business since 2015 and stood to incur great irreparable loss, prejudice and damage if the unprocedural, malicious and unlawful eviction is not stopped by this Tribunal. As such, it was in the best interest of justice that the orders be granted.

5. The tenant relies on a lease agreement marked ‘MA0-1’ which is dated June 6, 2016 which is for a period of 15 years. I have not seen any termination clause within the first 5 years in the said lease agreement.

6. The tenant operates a school, Restaurant and shops on the suit premises. On October 26, 2021, the landlord served a notice dated October 26, 2021 upon the tenant requiring him to vacate the suit premises on grounds that she wanted to demolish it. The notice is marked ‘MAO-3’ and was expressed to take effect on January 1, 2022.

7. Following the said notice, the tenant filed a reference under section 6 of cap. 301 laws of Kenya to oppose it and the reference was registered as BPRT No E799 of 2021 which is still pending before this Tribunal.

8. According to the tenant, the landlord had mischievously gone to Nairobi City County and used Public health grounds as a basis to evict it and his subtenants from the premises without any colour of right and notice. The landlord’s action is impugned as illegal and contrary to cap 301, Laws of Kenya.

9. The tenant came to this Tribunal fearing that the landlord would demolish, prevent or obstruct it from its business, deny access, harass, evict or interfere with its business which could occasion loss to it.

10. Interim orders of injunction were issued on August 19, 2022 pending hearing inter-partes on August 19, 2022.

11. On August 26, 2022, the landlord moved this Tribunal vide a motion under certificate of urgency seeking for orders to strike out, discharge, vary, vacate and/or set aside the orders issued on August 19, 2022. The application is supported by the landlord’s affidavit of even date wherein she deposes that on May 13, 2022, she received a letter from the Public Health Department containing a list of conditions to comply with marked ‘MWG1’.

12. The landlord was however unable to comply with the said conditions owing to the tenants occupation of the premises and lack of finances. As a result, she was arraigned before the Nairobi City County vide Criminal Case No 120A of 2022 and on July 18, 2022 when the matter came up for hearing, the Chief Magistrate gave orders as follows:-“(i)That a notice is hereby issued for the accused’s tenants to vacate as soon as possible but not more than one month later.(ii)That accused is given at least 6(six) months within which to repair the building after the tenants vacate the premises on plot No 36/VII/435. (iii)That this case be mentioned on September 30, 2022 to assess progress made”.

13. The said order and court proceedings are annexed as “MWG 2 & 3” respectively. All the tenants vacated and the landlord demolished the building structures standing on LR No 36/VII/435 to enable her construct a building that complies with requirements of the public health department. The landlord annexed as ‘MWG 4” a photograph of the demolished building.

14. As such, the landlord contends that there was no existing landlord/tenant relationship between her ad the applicant and his remedy lies in a civil court and not this Tribunal. As such, the application and reference by the applicant ought to be dismissed.

15. The application was ordered to be served for hearing inter-partes on September 13, 2022 together with the one dated August 17, 2022. However, the said date was declared a public holiday. The matter was subsequently fixed for hearing on October 24, 2022.

16. On October 24, 2022, the tenant was granted leave to file and serve supplementary affidavit and submissions within 7 days and the landlord was granted 7 days thereafter to file submissions on both applications and the complaint. The matter was therefore fixed for mention on November 8, 2022 to confirm compliance and fix a ruling date.

17. The tenant filed a replying affidavit sworn on October 21, 2022 and thereafter a supplementary affidavit sworn on October 31, 2022. In both affidavits, the tenant complains that the landlord used proceedings instituted before the Nairobi City Court as a pretext to evict him from the suit premises without notice after she pleaded guilty. It was not notified of the criminal case. It maintains that it has a valid lease entered into on June 6, 2016 for 15 years.

18. It is contended by the tenant that neither the landlord nor the Nairobi City County notified it about the allegation that the suit property was not in perfect condition under the Public Health Act and that the landlord knew that the matter was before this Tribunal.

19. According to the tenant its lease expires in 2031 and the allegation that the landlord is in the process of erecting a building on the suit property is absolutely not true as he had obtained all licenses and permits to develop the suit property as evidenced by annexure “MA0-1”.

20. The tenant deposes that he was in the process of reconstructing the property as per the lease agreement of June 6, 2016 and was in full possession of the property and paid rent up to February 2023. He states that he has subtenants carrying out business on the suit property.

21. According to the tenant, since there was a reference pending before this Tribunal, it is within its powers to determine whether the eviction was made lawfully.

22. On November 8, 2022, this Tribunal directed its Rent Inspector o visit the suit premises and establish if the building thereon is demolished and whether the tenant was in occupation of any part of it. The matter was thus set for mention on November 21, 2022 to confirm the inspection and report.

23. A visit was conducted on November 17, 2022 and a report was duly filed in this Tribunal which confirmed that there was no building on the suit plot and that demolition was effected on August 6, 2022.

24. Both parties filed submissions pursuant to earlier directions given on October 24, 2022.

25. I am therefore required to determine the following issues:-a.Whether this Tribunal has jurisdiction to entertain the instant dispute and grant reliefs sought by the tenant/applicant in the reference dated August 17, 2022. b.Whether the landlord has established a basis for the grant of the reliefs sought in the application dated August 26, 2022. c.Who is liable to pay costs?

26. The relationship between he two parties herein is founded on a lease dated June 6, 2016 entered into between them over LR No Nairobi 36/VI1/435, Eastleigh for a period of 15 years. The said lease is annexed to the tenant’s supporting affidavit sworn on August 17, 2022 and marked “MA0-1’. The same has no termination clause within the initial 5 years by either party.

27. Under clause 7. 17 of the said lease any differences or question which may arise at anytime between the parties touching upon construction of the agreement and the rights and liabilities of the parties shall be referred to a single arbitrator to be agreed upon between the parties or in default of agreement within 14 days to be appointed at the request of any party by the chairman for the time being of the Kenya Branch of Chartered Institute of Arbitrators or the Vice chairman if the chairman is unable or disqualified to act for any reason.

28. Section 2(1) of cap 301, laws of Kenya defines a controlled tenancy to mean a tenancy of a shop, hotel or catering establishment:-a.Which has not been reduced into writing orb.Which has been reduced into writing and which:-i.Is for a period not exceeding five years orii.Contains provision for termination, otherwise than for breach of covenant within five years from the commencement thereof oriii.relates to premises of a class specified under subsection (2) of this section”.

29. It is therefore clear from the foregoing that the tenancy relationship entered into between the parties herein is not a controlled tenancy within the meaning and interpretation of the foregoing provision of the said Act.

30. In the case of Owners of Motor Vessel ‘Lillian S’ v Caltex Oil (Kenya) Ltd [1989] eKLR, it was held at page 8-9/27 on the question of jurisdiction as follows:-“…….I think that it is reasonably plain that a question of jurisdiction ought to be raised at the earliest opportunity and the court seized of the matter is then obliged to decide the issue right away on the material before it. Jurisdiction is everything, without it, a court has no power to make one more step. Where a court has no jurisdiction, there would be no basis for a continuation of proceedings pending other evidence. A court of law down tools in respect of the matter before it the moment it holds the opinion that it is without jurisdiction”.

31. Guided by the said court of appeal decision, I am inclined to hold that the matter filed by the tenant herein is before the wrong forum. As observed by the Supreme Court in Samuel Kamau Macharia & another v Kenya Commercial Bank Limited & 2 others [2012] eKLR jurisdiction is granted by statute or by the Constitution and cannot be conferred by consent of parties or acquiescence.

32. Again, the parties ought to have subjected their dispute to arbitration under clause 7. 17 of the lease agreement pursuant to the provisions of the Arbitration Act, 1995. The case was wrongly filed in this Tribunal.

33. Even if there was a controlled tenancy between the parties, the Tribunals jurisdiction was ousted by the demolition of the premises hosting the tenant’s business and as such the same cannot be continued in the circumstances in line with the decision in the case of Pritam v Ratilal & another (1972) EA 560 at page 562 where it was held as follows:-“……………Therefore, the existence of the relationship of landlord and tenant is a prerequisite to the application of the provisions of the Act. Where such a relationship does not exist or it has come to or been brought to an end, the provisions of the Act will not apply. The applicability of the Act is a condition precedent to the exercise of jurisdiction by the Tribunal, otherwise, the Tribunal will have no jurisdiction. There must be a controlled tenancy as defined in Section 2 to which the provisions of the Act can be made to apply, outside it, the Tribunal has no jurisdiction”.

34. I have seen the superior courts’ decisions in the cases of Dhirajlal J Shah & another v Vijay Amritlal Shethia [2018] eKLR, Kenneth Njoroge Ndumbi v Kavore Kariuki [2021] eKLR and Spares Corner (K) Ltd v Mariam Noormohamed, Abdul Hamid Noormohamed, Ismael Noormohamed [2003] eKLR and the facts in those cases are clearly different from those in the present case in that they all dealt with controlled tenancies which should litigated in this Tribunal while in the present case, the tenancy is uncontrolled under section 2(1) of cap 301, laws of Kenya. As such, there cannot be jurisdiction where there is none in line with the Court of Appeal decision in the case of Phoenix of EA Company Limited v SM Thiga t/a Newspaper Service [2019] eKLR where it was held as follows at paragraph 2:-“In common English Parlance, Jurisdiction “denotes the authority or power to hear and determine judicial disputes or to even take cognizance of the same. This definition clearly shows that before a court can be seized of a matter, it must satisfy itself that it has authority to hear it and make a determination. If a court therefore proceeds to hear a dispute without jurisdiction, then, the result will be a nullity ab initio and any determination made by such court will be amenable to being set aside ex debito justitiae”.

35. In the premises, in absence of jurisdiction to deal with this matter, the reliefs sought by the tenant/applicant in the reference and application dated August 17, 2022 cannot be granted.

36. Flowing from the above, the reliefs sought by the landlord in the application dated August 26, 2022 are merited under section 12 (1) (i) ofcap301, laws of Kenya which grants this Tribunal jurisdiction to vary or rescind any order made by it under the provisions of the Act.

37. In regard to costs, the same always follow the event unless otherwise ordered for good reasons given under section 12(1) (k) of cap 301, laws of Kenya. I shall exercise my discretion to award costs to the landlord/respondent.

38. In conclusion, the final orders which commend to me under section 12(4) of cap 301, laws of Kenya on the issues framed are as follows:-a.This tribunal has no jurisdiction to entertain the tenant’s dispute or grant the reliefs sought in the reference and application dated August 17, 2022 and the same is dismissed with costs.b.The landlord’s application dated August 26, 2022 is allowed and the interim orders issued on August 19, 2022 are hereby discharged and/or set aside forthwith.c.The landlord’s costs in the matter are assessed at Kshs 30,000/- all inclusive.It is so ordered

RULING DATED, SIGNED & DELIVERED THIS 16TH DAY OF DECEMBER, 2022. HON GAKUHI CHEGEVICE CHAIRBUSINESS PREMISES RENT TRIBUNALRuling delivered in the presence of:Mr Lakicha for the TenantMiss Mwara holding brief for Miss Ndungu for the Landlord.