[2022] KEBPRT 826 (KLR)

Mwalimu Traders v Lalani (Tribunal Case 075 of 2021) [2022] KEBPRT 826 (KLR) (Civ) (10 November 2022) (Ruling)

Neutral citation: [2022] KEBPRT 826 (KLR)

Republic of Kenya

In the Business Premises Rent Tribunal

Civil

Tribunal Case 075 of 2021

Andrew Muma, Vice Chair

November 10, 2022

Between

Mwalimu Traders

Tenant

and

Mohammed Lalani

Landlord

Ruling

A. Parties And Representatives 1. The Applicant Mahendra Patel t/a Mwalimu Traders is the Tenant of a rented business space situate at property known as Kakamega Town Block I/189- Kenyatta Street. (hereinafter known as the Tenant)

2. The firm of M/S Kibet Adoli & Magina Advocates represents the Tenant/ Applicant.

3. The Respondent Mohamed Lalani is the Landlord of a rented business space situate at property known as Kakamega Town Block I/189- Kenyatta Street. (hereinafter known as the Landlord)

4. The firm of M/S Akwala & Co Advocates represent the Tenant/ Respondent.

B. The Dispute Background 5. The Tenant filed a reference dated November 18, 2021 challenging the Landlord’s Notice to terminate the Tenancy dated August 30, 2021.

6. The Tenant also filed an application through notice of motion dated June 23, 2022 supported by an affidavit and witness statement of even date.

7. The Landlord filed a replying affidavit dated June 13, 2022 and a further affidavit dated August 18, 2022.

8. The Landlord filed submissions dated August 18, 2022 while the Tenant filed submissions dated September 4, 2022.

C. Jurisdiction 9. The jurisdiction of this tribunal is not in dispute.

D. The Tenant’s Claim 10. The Tenant filed the reference at the Tribunal challenging the Landlord’s Notice of Termination of Tenancy dated August 30, 2021. The Notice was to take effect from January 1, 2022.

11. In the application through Notice of Motion dated June 23, 2022, the Tenant sought orders declaring that the Landlord treated the tenant unfairly and maliciously by unreasonably increasing rent at a very high percentage, a declaration that the notice to terminate tenancy dated August 30, 2021 is invalid the same having been issued maliciously, a declaration that the tenant is not in default in payment of rent, a declaration that the rent payable for the premises leased by the Tenant is Kshs 51,400. 00, a refund of Kshs 70,000. 00 paid to Eshikoni Auctioneers, costs of the suit and any other relief the Tribunal may deem fit to grant.

12. The grounds for the Application were that the Respondent has been unreasonably increasing rent at rates over 30% with the aim of pushing the plaintiff/ applicant out of business, that the respondent had issued a notice to terminate the Applicant’s lease for failure to pay rent when in fact he had paid rent, that the respondent had issued the notice to terminate the lease for having entered onto the premises without a lease when in fact there have been leases renewed after every two years for over 22 years. Further, that the respondent had issued a notice to terminate the applicant’s lease on the grounds that he needs the premises for use by the owner and family without any basis.

E. The Landlord’s Claim 13. The Landlord in his replying affidavits states that the reference filed by the Tenant is scandalous, frivolous and vexatious. He contends that the Applicant has been a tenant in the at the premises since 2001 even before he personally became the Landlord of the premises.

14. He states that he took over the premises after his sister passed on.

15. He further contends that the Tenant has been a troublesome tenant even in the past and has on several occasions defaulted in paying rent and they were forced to seek interventions of several advocates to write demand letters to compel the Tenant to pay rent.

16. The Landlord further states that the Tenant has been paying rent of Kshs 57,000. 00 per month which was increased at the rate of 20% with effect from the month of October 2021 and the Tenant was well aware of the increment.

17. He further contends that the Tenant has been hesitant, stubborn and difficult when it comes to payment of the rent and he had communicated to him to find alternative place and he did not show any interest hence the termination notice which the tenant opposed herein. He states that since the Tenant filed the refence at the Tribunal he stopped paying the monthly rent of Kshs 57,000. 00 in spite of being in occupation of the premises. That the rent has accumulated to a figure of Kshs 604,200. 00 and he fears the same will keep increasing if the Tenant is allowed to continue staying in the premises.

18. He therefore prays that the Tenant be compelled to vacate the premises, pay the rent arrears from the month of September 2021 with interest at court rates and the costs of the reference.

F. List Of Issues For Determination 19. The issues raised for determination before this Tribunal are as follows;i.Whether the Landlord’s Notice to terminate the tenancy was valid.ii.Whether the grounds for termination of the tenancy were justified.

G. Analysis and Findingsi.Whether the Landlord’s Notice to terminate the tenancy was valid.

20. It is the Tenant’s contention that the Landlord’s Notice to terminate the Tenancy dated August 30, 2021 was not valid for reasons mentioned earlier.

21. The Landlord had issued the Notice to terminate the tenancy pursuant to Section 4 of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act. The Provisions of Section 4 of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act are as follows:4. Termination of, and alteration of terms and conditions in, controlled tenancy1. Notwithstanding the provisions of any other written law or anything contained in the terms and conditions of a controlled tenancy, no such tenancy shall terminate or be terminated, and no term or condition in, or right or service enjoyed by the tenant of, any such tenancy shall be altered, otherwise than in accordance with the following provisions of this Act.2. A landlord who wishes to terminate a controlled tenancy, or to alter, to the detriment of the tenant, any term or condition in, or right or service enjoyed by the tenant under, such a tenancy, shall give notice in that behalf to the tenant in the prescribed form.3. A tenant who wishes to obtain a reassessment of the rent of a controlled tenancy or the alteration of any term or condition in, or of any right or service enjoyed by him under, such a tenancy, shall give notice in that behalf to the landlord in the prescribed form.4. No tenancy notice shall take effect until such date, not being less than two months after the receipt thereof by the receiving party, as shall be specified therein:…5. A tenancy notice shall not be effective for any of the purposes of this Act unless it specifies the grounds upon which the requesting party seeks the termination, alteration or reassessment concerned and requires the receiving party to notify the requesting party in writing, within one month after the date of receipt of the notice, whether or not he agrees to comply with the notice.6. A tenancy notice may be given to the receiving party by delivering it to him personally, or to an adult member of his family, or to any other servant residing within or employed in the premises concerned, or to his employer, or by sending it by prepaid registered post to his last known address, and any such notice shall be deemed to have been given on the date on which it was so delivered, or on the date of the postal receipt given by a person receiving the letter from the postal authorities, as the case may be.

22. In a plain reading of the Landlord’s Notice of Termination of Tenancy dated August 30, 2021, this tribunal is of the view that that the notice meets the legal threshold required of such notices.

23. First, it in the prescribed form. Second, the notice period was sufficient and satisfied the requirements of Section 4(4) of the Act the Notice was issued on August 30, 2021 and was to take effect on January 1, 2022. That is a whole 4 months notice period.

24. Thirdly, the notice specified the grounds upon which it was made and finally it was delivered to the Tenants in good time.

25. The question that remains is whether the grounds spelt out by the Landlord in the Notice to terminate are justified. This question shall be dealt with conclusively in the analysis of the next issue.ii.Whether the grounds for termination of the tenancy were justified.

26. The Landlord in the Notice of Termination dated August 30, 2021 stated that the grounds of termination were: That the Tenant had entered the premises without authority, non payment of rent arrears by the Tenant and that the premises were required for use by the owner and his family.

27. The Tenant painstakingly submitted that the Landlord had treated him unfairly and maliciously by unreasonably increasing rent at very high percentages. He highlighted instances he considered the Landlord had unreasonably raised rent and even states that the trend of rent increment happens coincidentally when the Landlord disagrees with his siblings.

28. In going through the pleadings and submissions by both parties, this Tribunal is of the view that those are issues which this Tribunal cannot make a decision on since they happened over time and the Tenant has always complied with the notices on rent increment. He acquiesced his rights and this tribunal cannot save him through the instant suit. The issue of malicious increase of rent is therefore far fetched.

29. The other issue of concern was that the Landlord had contended in the Notice of termination that the Tenant had entered the premises without authority or agreement. However in is pleadings the Landlord states that the Tenant has been in the premises since 2001. The Tenant has even gone the extra mile to annex Lease agreements signed by him and the Landlord. This ground is therefore not justified.

30. The other ground for termination was non payment of rent by the Tenant which the Landlord further submits has been ongoing for quite some time and the arrears had accumulated to a sum of Kshs 741,000. 00 as at July 2022.

31. In an affidavit sworn on 18th August 2022, the Landlord states that the Tenant paid a sum of Kshs342,000. 00 after being prompted by auctioneers and later a sum of Kshs 270,000. 00 all totaling up to Kshs 570,000. 00 to cover the rent at old rates up to June 2022.

32. In his submissions dated September 4, 2022, the tenant states that he is up to date with his payment and has confirmation receipts to confirm those payments. This information cannot however be ascertained by this Tribunal since the Tenant has not tendered any evidence on the same.

33. The issue of rent payments gets murkier with both parties filing valuation reports to buttress their positions on the amount of rent that should be paid for the premises. This Tribunal is of the opinion that the Valuation reports were not necessary as the issue was not a determination of rental value to be paid.

34. This Tribunal is of the opinion that the rent payable is that which had been agreed by the parties that is Kshs 57,000. 00 notwithstanding the contents of the valuation reports. The issue for determination herein is not a notice for rent increment.

35. As for the rent increment that was to be effected form October 2021, this Tribunal finds that it is unconscionable since the notice was made after the Tenant had filed a reference to this Tribunal. Such notice is therefore illegal and unforceable.

36. As for the last ground stated by the Landlord in the termination notice. The Landlord has not laid any basis or even submitted on the same. This Tribunal is therefore of the opinion that the ground is not justified.

37. The other issues was the Kshs 70,000. 00 paid by the Tenant to Eshikoni Auctioneers. On this issue, the Tribunal is of the view that the procedure for distressing for rent is laid out in law. In the instant case, that procedure was not followed it is therefore only fair that the Landlord reimburses the Tenant for the monies paid to the auctioneers.

H. Orders 38. I. Having made the analysis above. This Tribunal makes the following orders:i.The Tenant’s reference dated November 18, 2021 is merited on the basis that the grounds stated by the Landlord in the Notice of Termination of Tenancy are not justified.ii.The Landlord to produce a statement of arrears at Kshs 57,000. 00 per month strictly as from 2019 and Tenant does pay the same within 60 days in default Landlord at liberty to distress.iii.The Landlord to refund the Tenant Kshs 70,000. 00 paid to Eshikoni Auctioneers to be offset from rent arrears as it was done without leave.iv.Status quo be maintained and the Tenant to continue paying the agreed rent of Kshs57,000. 00. Landlord at liberty to issue a fresh notice for rent increment.v.Each party to bear its own costs.

HON A MUMAVICE CHAIRBUSINESS PREMISES RENT TRIBUNALJUDGMENT DATED, SIGNED AND DELIVERED VIRTUALLY BY HON A. MUMA THIS 10TH DAY OF NOVEMBER 2022 IN THE ABSENCE OF ALL PARTIES.HON A MUMAVICE CHAIRBUSINESS PREMISES RENT TRIBUNAL