[2023] KEELC 18523 (KLR)

Migiro v Paintmart and Allied Building Equipment (K) Limited (Civil Suit E448 of 2021) [2023] KEELC 18523 (KLR) (6 July 2023) (Ruling)

Neutral citation: [2023] KEELC 18523 (KLR)

Republic of Kenya

In the Environment and Land Court at Nairobi

Civil Suit E448 of 2021

OA Angote, J

July 6, 2023

Between

David Mokaya Migiro

Plaintiff

and

Paintmart and Allied Building Equipment (K) Limited

Defendant

Ruling

Background 1. What is coming up before the Court is the Plaintiff’s/Applicant’s Notice of Motion application dated 23rd December, 2021 brought pursuant to the provisions of Section 1B, 3, 3A and 63 (c) and (e) of the Civil Procedure Act, Order 40 Rule 1 and 2 of the Civil Procedure Rules, 2010 seeking the following reliefs;a.That this Honourable Court be pleased to restrain the Defendant by themselves or through their servants, agents, licensees and/or employees by way of a temporary injunction from rescinding or cancelling or terminating the Plaintiffs tenancy over the property known as Land Reference Number 209/10201 pending the hearing and determination of the suit.b.That this Honourable Court be pleased to restrain the Defendant by themselves or through their servants, agents, licensees and/or employees by way of a temporary injunction from evicting the Plaintiff from the property known as Land Reference Number 209/10201 pending the hearing and determination of the suit.c.That the costs of this Application be borne by the Defendant.

2. The application is premised on the grounds on the face thereof and supported by the Affidavit of the Plaintiff who deponed that he purchased the business on the suit property as a going concern pursuant to an agreement dated 18th March, 2009 for a sum of Kshs 2,150,000 and that at the time of the purchase, the seller had a three-year lease that still had some period to run.

3. The Plaintiff deposed that after the tenancy he had inherited lapsed, he entered into an agreement with the Defendant dated 19th September, 2011 for a period of 5 years which lapsed in 2016 whereafter he entered into another agreement dated 1st October, 2016; that during the course of the tenancy, he negotiated and transacted with Mr. James Ochoki, the principal shareholder of the Defendant company and that they eventually became friends and entered into verbal agreements in respect of the tenancy.

4. According to the Plaintiff, Mr. Ochoki’s children were minority shareholders in the company; that when the lease was about to expire in October, 2021, in March, 2018, he entered into an agreement with Mr Ochoki’s whereby he was allowed to carry out extensive improvements on the suit property and that on the strength of the aforesaid agreement, he procured approvals and set about renovating the premises to a modern setting in the expectation that he would be given a long term contract so as to recoup his expenditure.

5. It was deposed by the Plaintiff that contrary to his expectations, he received a letter in August, 2021 informing him that he would not be getting another lease after October, 2021 and that he would have to vacate the premises on or before January, 2022 and that on 3rd September, 2021, he responded to the Defendant and requested that the lease be extended to enable him recoup his expenditure, which they declined vide their response of 23rd September, 2021.

6. According to the Plaintiff, the Defendant intends to take over his assets which are still new having been installed in 2018 and that he has not recouped the invested sum.

7. The Defendant, through its Director, deponed that the Plaintiff is well known to her and has been their tenant for a while; that they have renewed his lease twice after it lapsed in 2011 and 2016 and that the Plaintiff is operating a bar and restaurant business on the property known as Citizen Club Vibro.

8. According to the Defendant’s Director, she is a stranger to the alleged negotiations between the Plaintiff and her deceased husband regarding extension of the lease; that in any event, the property is owned by a company and as a Director, she is not privy to any negotiations and that the lease extended by them in 2016 expressly provided vide clause 3 that the structures on the plot should be strictly temporary.

9. It is the Defendant’s case that the Plaintiff ought to have formally approached the Defendant as a company as regards extension of the lease; that the acts of a single Director cannot bind the company and that in any event, the company was not privy to any deliberations on a request for extensive improvements on the property.

10. According to Ms Ochoki, she is unaware of any board resolution authorizing extensive developments on the suit property; that in any event, the extensions and improvements were contrary to the terms of the Lease in existence at the time and that the Plaintiff acknowledges that the Lease lapsed in October, 2021 and as such there is no existing lease between the parties.

11. It was deposed by the Defendant’s Director that the prerogative to extend and/or renew the Lease lies with the landlord; that they have no interest in the Plaintiff’s fixtures and fittings but vacant possession of the property and that as there is no Lease in writing between the parties, there is a controlled tenancy and as such this Court lacks the jurisdiction to entertain this matter.

12. Contemporaneously with the response, the Defendant filed a Preliminary Objection on the grounds that;i.The suit and application offend the mandatory provisions of Section 2(1) of the Landlords and Tenants (Shops, Hotels and Catering Establishment) Act, Cap 301.

13. Vide the Supplementary Affidavit, the Plaintiff deponed that the dispute herein relates to private land and a contract granting a Lease and falls within the jurisdiction of the Court as contemplated under Section 13(d) of the Environment and Land Court Act (ELC Act) and that pursuant to Section 13(7) (a) of the ELC Act, the Court has, in exercise of its jurisdiction, the power to make any order or grant any relief including interim or permanent preservation orders including injunctions.

14. It was deposed by the Plaintiff that the Bussiness Premises Rent Tribunal derives its mandate from Section 12 of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, which does not grant the Tribunal powers to grant injunctive reliefs and as such the Preliminary Objection is not merited.

15. The Plaintiff deponed that from the time he took over the tenancy of the suit premises, he has only dealt with Mr Ondimu who has been the sole signatory of all the Tenancy Agreements; that at no time were there any minutes authorizing him to act as he did neither did he have any issues with the tenancy and that it is on the strength of these negotiations and agreements with Mr Ondimu that he took possession of the premises.

16. It is the Plaintiff’s case that the only reason he substantially invested in the property was because he had no doubt that Mr Ondimu would give him a 10-year extension of lease as promised; that to enable him make applications to the City County Planning Authorities, he needed documents from the registered proprietor which Mr Ondimu readily gave him and that he leased the property from the premises previous owners who also informed him that they solely dealt with Mr. Ondimu.

17. According to the Plaintiff, he will plead the doctrine of estoppel to prevent the Defendant from reneging on the promise to grant him a 10-year lease and that all along, Mr Ondimu and his wife have dealt with matters pertaining to the property in their personal capacity including the receipt of rent.

Submissions 18. The Plaintiff advocate submitted that this Court derives its jurisdiction from Section 13 (1) of the Environment and Land Court Act (ELC Act) which provides that the Court can hear and determine all disputes in accordance with Article 162(2) (b) of the Constitution and that Section 13(7) of the Act provides that in exercise of its powers, the Court can grant interim or permanent preservation orders including injunction.

19. It was submitted that on the other hand, the BPRT derives its jurisdiction from Section 12 which does not grant it powers to grant interim orders; that as the Plaintiff is seeking injunctive orders, it is only this Court that can grant the same.

20. Counsel submitted that the Court in Republic vs Bussiness Premises Rent Tribunal Ex-parte Albert Kigera Karume[2015]eKLR cited with approval the case of Re Hebtulla Properties Limited[1979]KLR 96[1976-80]1 KLR 1195 which stated that the Tribunal does not have jurisdiction to do anything not spelled out under Section 12 of the Act and that in the case of Amos Keireri Kanyugo vs Kireithi Trust [2017] eKLR the Court adopted the decision in Moses N Gitonga & Another vs George Gathacea Kinyanjui & Another[2014]eKLR which held that the right forum to seek orders of injunction is the High Court even where there is a case pending at the BPRT.

21. It was submitted that as the application is properly before the Court, it should be determined on the basis of the principles of injunction as laid out in Giella vs Cassman Brown Co Ltd [1973] EA 358; that the Plaintiff has explained that the property in issue is a business premises that has attracted goodwill and that the loss the Plaintiff will suffer in the event an injunction is declined would be irreparable.

22. Counsel for the Plaintiff submitted that the Defendant having led the Plaintiff to redevelop the property at a great expense and under the expectation that he would get a 10- year tenancy, is estopped from denying the same. Reliance in this respect was placed on Section 120 of the Evidence Act and the Court of Appeal decision of Serah Njeri Mwobi vs John Kimani Njoroge[2013]eKLR where the Court held that the doctrine of estoppel operates as a principle of law which precludes a person from asserting something contrary to what is implied by a previous action or statement of that person.

23. It was submitted by counsel that as stated by the Court in Said Ahmed vs Mannasseh Denga & Another [2019]eKLR, a party should not be allowed to maintain an advantageous position he has gained simply because he can pay for it and that in the case of Joseph Siro Mosioma vs Housing Finance Company of Kenya Limited & 3 Others[2008]eKLR, the Court emphasized that damages cannot be substituted for loss occasioned by a clear breach of the law and that having demonstrated a prima facie case and irreparable injury, the balance of convenience lies in favour of the grant of the injunction.

24. The Defendant’s counsel submitted that it is not disputed that there exists a controlled tenancy and that it is the Business Premises Rent Tribunal and not this Court that is vested with jurisdiction to entertain the dispute. Reliance in this respect was placed on the cases of John Mugo Ngunga vs Margaret M Murangi[2014]eKLR where the Court of Appeal affirmed that the Tribunal has jurisdiction to issue injunctive orders.

25. It was submitted by counsel that in the case of Republic vs Chairman Bussiness Premises Rent Tribunal Audio Corner Limited (Interested Party) Ex-parte Thande Holdings Limited [2020]eKLR, the Court guided by the pronouncement in John Mugo Ngunga case (supra) found that where the Tribunal is properly seized of jurisdiction, it can properly issue an injunctive or conservatory order.

26. It was submitted by the Defendant’s counsel that the above notwithstanding, the Plaintiff has not met the threshold for the grant of temporary injunctive orders sought; that the Plaintiff has not demonstrated a prima facie case with a probability of success and that the Plaintiff has conceded that he was aware that the Lease was expiring in October, 2021 and has not averred that the procedure provided under the Lease was not followed.

27. According to counsel, the Plaintiff’s attempts to have the Court enforce a verbal agreement is untenable especially as one party to the alleged verbal agreement is deceased and that the Plaintiff has not demonstrated nor indeed averred that he will suffer irreparable injury that cannot be compensated by an award of damages.

Analysis & Determination 28. Having analyzed the pleadings and submissions by the parties, the issues that arise for determination are;i.Whether this Court has jurisdiction to entertain the matter and if so,ii.Whether the Plaintiff/Applicant has met the threshold for the grant of a temporary injunction.

29. Vide the Preliminary Objection, the Defendant asserts that this court does not have jurisdiction to entertain the matter. Indeed, as was affirmed by the Court of Appeal in Mukisa Biscuits Manufacturing Co. Ltd. vs West End Distributors (1969) EA 696 at 700, an objection to the jurisdiction of the court is one of the preliminary objections that consists of a point of law.

30. The centrality of jurisdiction in any proceedings need not be over emphasized. Nyaranji J.A succinctly captured this in Owners of Motor Vessel ‘Lillian S’ vs Caltex Oil (Kenya) Limited [1989] KLR 1 as follows:“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…”

31. Similarly, the Court of Appeal in the case of Kakuta Maimai Hamisi vs Peris Pesi Tobiko & 2 Others [2013] eKLR stated as follows:“So central and determinative is the jurisdiction that it is at once fundamental and over-arching as far as any judicial proceedings is concerned. It is a threshold question and best taken at inception. It is definitive and determinative and prompt pronouncement on it once it appears to be in issue in a consideration imposed on courts out of decent respect for economy and efficiency and necessary eschewing of a polite but ultimate futile undertaking of proceedings that will end in barren cui-de-sac. Courts, like nature, must not sit in vain.”

32. The crux of the Defendant’s contention in this regard is that the parties herein are in a controlled tenancy by virtue of the fact that the Lease between them lapsed and that as a result thereof, the Business Premises Rent Tribunal is vested with the jurisdiction to handle the dispute between them including the grant of the injunctive orders sought by the Plaintiff.

33. In response, the Plaintiff asserts that the Tribunal does not have jurisdiction to grant injunctive orders and as such does not have jurisdiction over the present suit.

34. To begin with, it is not disputed that the parties herein were in a landlord-tenant relationship over a business premises being a bar and restaurant known as Club Citizen Vibro. This relationship was governed by a Lease which as admitted lapsed sometime in October 2021. The Plaintiff is however still on the premises.

35. In the instant suit and application, the Plaintiff is seeking to have the Defendant restrained from terminating the tenancy and/or evicting him from the suit premises. According to the Plaintiff, it is this court that has jurisdiction to issue injunctive orders notwithstanding that the tenancy in question is controlled.

36. It is clear from the foregoing that the parties are in a controlled tenancy as defined by Section 2 of the Landlords and Tenant (Shops, Hotels and Establishments) Act (hereinafter the Act), which provides as one of the definitions of a controlled tenancy as a tenancy “which has not been reduced into writing.”

37. It is apparent that both parties are agreeable that the Business Premises Rent Tribunal is vested with jurisdiction to determine the matter. The point of divergence appears to be whether or not the Tribunal can issue the injunctive orders sought. The Plaintiff asserts that it cannot and that the matter is properly before this Court, whereas the Defendant contends that it can and by virtue thereof, this Court has no jurisdiction to entertain the dispute.

38. The Courts have had the occasion to determine the question of whether or not the Business Premises Rent Tribunal can issue injunctive or preservatory orders and there are two schools of thought in that respect. One school of thought contends that it is only the High Court (read ELC) which can issue injunctive orders whereas the other states that the Tribunal has jurisdiction to grant the same.

39. In the case of Republic vs Business Premises Rent Tribunal & Another & Exparte Davies Motor Corporation Limited [2013] eKLR, Odunga, J. held as follows:“The issue for determination is therefore whether the Respondent had jurisdiction to grant an order of injunction. On my part I agree that the spirit of the Act which is to ensure the protection of tenants of controlled tenancies from eviction or exploitation would be rendered nugatory if the Tribunal was not similarly granted the jurisdiction to preserve the status quo between the landlord and the tenant pending the determination of the dispute before it. It is however not for this Court to grant to the Tribunal powers which it does not have. As was held by the Court of Appeal in Italframe Ltd vs. Mediterranean Shipping Co. [1986] KLR 54; [1986-1989] EA 174:“It is not competent to any court to proceed upon an assumption that Parliament has made a mistake, there being a strong presumption that Parliament does not make mistakes. If blunders are found in legislation, they must be corrected by legislature, and it is not the function of the Court to repair them. Thus, while terms can be introduced into a statute to effect to its clear intention by remedying mere defects of language and to correct obvious misprints or misnomers no provision which is not in the statute can otherwise be implied to remedy an omission... It is one thing to introduce terms into an Act of Parliament in order to give effect to its clear intention by remedying mere defects of language. It is quite another thing to imply a provision which is not in the statute in order to remedy an omission, without any ground for thinking that you are carrying out what Parliament intended. It is not the function of the Courts to repair the blunders that are to be found in legislation. They must be corrected by the legislature.”Therefore, whereas it is my view that by not expressly granting the Tribunal the power to grant orders of injunction Parliament made a blunder since it rendered the intention and objective of the whole Act a mirage, based on the authorities from the Court of Appeal I am unable to find that the Tribunal is empowered under section 12 of the Act to grant orders of injunction.In Narshidas & Company Limited vs. Nyali Air Conditioning and Refrigeration Services Limited Civil Appeal No. 205 of 1995, the Court of Appeal held that a controlled tenant confronted with an illegal threat of forcible eviction cannot go to the Business Premises Rent Tribunal established under the Act as that Tribunal has no jurisdiction to issue an injunction or similar remedy against the landlord. Similar holdings were made in Caledonia Supermarket Ltd vs. Kenya National Examinations Council (supra) and Tiwi Beach Hotel Ltd vs. Julian Ulrike Stamn (supra). It follows that by granting orders of injunction the Respondent acted outside its mandate.” (emphasis mine).

40. This position was affirmed by the Court in Michael Gachie Mwarangu vs Peter Gichuru Maina & 2 Others [2016] eKLR. In Republic vs Business Premises Rent Tribunal & Another Ex parte Albert Kigera Karume [2015] eKLR, while quoting the case of Re Hebatullah sought to distinguish it and took the position that the Tribunal has jurisdiction to issue injunctive orders. The Court stated thus;“…This case, the orders which the applicant seeks to quash were injunctive orders. Simpson and Chesoni, JJ (as they were) in Re Hebtulla Properties Ltd. [1979] KLR 96; [1976-80] 1 KLR 1195 dealt in extenso with the provisions of section 12 of the said Act. Chesoni, J on his part expressed himself as follows:“The tribunal is a creature of statute and derives its powers from the statute that creates it. Its jurisdiction being limited by statute it can only do those things, which the statute has empowered it to do since its powers are expressed and cannot be implied…. …. The powers of the tribunal are contained in section 12(1) of the Act and anything not spelled out to be done by the tribunal is outside its area of jurisdiction. It has no jurisdiction except for the additional matters listed under section 12(1)(a) to (n). The Act was passed so as to protect tenants of certain premises from eviction and exploitation by the landlords and with that in mind the area of jurisdiction of the tribunal is to hear and determine references made to it under section 6 of the Act. Section 9 of the Act does not give any powers to the tribunal, but merely states what the tribunal may do within its area of jurisdiction…… It would be erroneous to think that section 12(4) confers on the tribunal any extra jurisdiction to that given by and under the Act elsewhere. For example it is not within the tribunal’s jurisdiction to deal with criminal acts committed in relation to any tenancy nor is it within its jurisdiction to entertain an action for damages for trespass. These are matters for the courts and the tribunal cannot by way of a complaint to it by the landlord or tenant purport to deal with such matters. Section 12(4) of the Act must be read together with the rest of the Act and, when this is done it becomes apparent that the complaint must be about a matter the tribunal has jurisdiction to deal with under the Act and that is why the complaint has to relate to a controlled tenancy…. The Act uses the words “any complaint” and the only qualification is that it must be “relating to a controlled tenancy”.In Narshidas & Company Limited vs. Nyali Air Conditioning and Refrigeration Services Limited Civil Appeal No. 205 Of 1995, the Court of Appeal held that a controlled tenant confronted with an illegal threat of forcible eviction cannot go to the Business Premises Rent Tribunal established under the Act as that Tribunal has no jurisdiction to issue an injunction or similar remedy against the landlord. It is true that in that case the Court of Appeal cited the decision in Republic vs. Business Premises Rent Tribunal and Others ex parte Karasha [1979] KLR 147 and Re Hebtulla Case.I however agree with the interested parties that the cases cited by the Court of Appeal did not expressly state that the Tribunal had no jurisdiction to grant orders of injunction. To the contrary what the said decisions held was that the Tribunal had no powers to grant orders whose effect would be to reinstate a dispossessed tenant to the suit premises which orders are ordinarily mandatory in nature.It is therefore my view and I so hold that until Parliament enacts legislation limiting or restricting the powers of the Tribunal the Tribunal has the powers to grant orders prescribed under section 63(c) of the Civil Procedure Act including orders of temporary injunction.”

41. The Court of Appeal in John Mugo Ngunga vs Margaret M Murangi [2014] eKLR rendered itself as follows:“The issue of powers vested upon the Rent Restriction Tribunal and the orders that it can issue was also covered very broadly by the Court of Appeal decision in the case of Rent Restriction Tribunal V Raval Ex-parte Mayfair Bakeries Limited, [1985] KLR 167 where the Court held on page 180 as follows“As we see it the powers of the Tribunal are not restricted to those conferred by section 5 of the Act. Section 6 confers upon it the additional powers to investigate any complaints relating to the tenancy of premises made to it by either a tenant or the land lord of such premises. The interested party was a tenant – although a statutory tenant. Which matters not – when he made his complaint to the Tribunal. It may be “any” complaint. It matters not if the complaint is in tort or contract or equity or otherwise. The criterion is that the complaint must be relating to the tenancy. Here the complaint in effect is that the tenant was being harassed in the quiet enjoyment of his tenancy. Therefore, the Tribunal was empowered to investigate that complaint, and a fortiori under subsection (5) of Section 6 it could make such order in the matter as the justice of the case may require being an order which it is empowered to make by the Act, …”.On the jurisdiction of the Tribunal to issue an order of injunction, it is clear the Judge was right, the jurisdiction is provided for by the Act and that was further fortified by the aforesaid decision of this Court.”

42. Relying on the aforesaid case, the Court in Republic vs Chairman Business Premises Rent Tribunal; Audio Corner Limited (Interested Part) Ex parte Thande Holdings Limited [2020] eKLR stated as follows;“In light of the above pronouncement by the Court of Appeal, my finding on the second issue is that where the Tribunal is properly seized of a dispute, it can properly issue an injunctive or conservatory order.”

43. Notwithstanding the conflicting positions, this court, guided by the decisions of the Court of Appeal and section 12 (4) of the Act is of the view that the Business Premises Rent Tribunal has jurisdiction to entertain this matter, and issue injunctive orders appropriately.

44. I say so because Section 12(4) of the Act provides that in addition to any other powers specifically conferred on it by or under the Act, the 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. The orders contemplated by the Act includes injunctive orders.

45. Indeed, it would not make legal sense for the Tribunal to entertain and investigate a complaint if it cannot issue orders preserving the suit premises pending the hearing and determination of the suit. The Court is in this respect further guided by the framework of Article 169 of the Constitution which categorizes local tribunals as subordinate courts. As subordinate courts, they have jurisdiction under Sections 3A and 40 of the Civil Procedure Act to issue injunctive orders.

46. It is trite that where a mechanism is provided by legislation, that mechanism should be followed. This has been the consistent position of the courts in this jurisdiction. In Speaker of the National Assembly vs Karume (2008) 1 KLR (EP) 425 the Court of Appeal expressed itself as follows:“In our view, there is considerable merit in the submission that where there is a clear procedure for the redress of any particular grievance prescribed by the Constitution or an Act of Parliament, that procedure should be strictly followed.”

47. In conclusion, the Court finds that the Bussiness Premises Rent Tribunal is duly vested with jurisdiction to handle the present dispute, and should this Court determine the same, it will be overstepping the Tribunal’s mandate. The Court must therefore down its tools. In the end, the Preliminary Objection is found to be merited.

48. For those reasons, the application dated 23rd December, 2021 and the suit are struck out but with no order as to costs.

DATED, SIGNED AND DELIVERED VIRTUALLY IN NAIROBI THIS 6TH DAY JULY, 2023O. A. ANGOTEJUDGEIn the presence of;Mr. Khayega for Plaintiff/ApplicantNo appearance for DefendantCourt Assistant - Tracy