Nippon Energy Services (K) Limited v Sidian Bank Limited & another (Commercial Suit E541 of 2025) [2026] KEHC 6966 (KLR) (Commercial and Tax) (8 May 2026) (Ruling)

Nippon Energy Services (K) Limited v Sidian Bank Limited & another (Commercial Suit E541 of 2025) [2026] KEHC 6966 (KLR) (Commercial and Tax) (8 May 2026) (Ruling) Neutral citation: [2026] KEHC 6966 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Commercial Courts) Commercial and Tax Commercial Suit E541 of 2025 MN Mwangi, J May 8, 2026 Between Nippon Energy Services (K) Limited Applicant and Sidian Bank Limited 1st Respondent Philips International Auctioneers 2nd Respondent Ruling 1.Before the Court for determination are two Notice of Motion applications dated 20th August 2025 and 3rd October 2025 filed pursuant to Sections 1A, 1B, 3 and 3A of the Civil Procedure Act, Order 17 Rule 1, Order 40 Rules 1 & 2, Order 51 Rule 1 of the Civil Procedure Rules, 2010, and Section 89(1) and 97 of the Land Registration Act. 2.In the application dated 20th August 2025, the applicant seeks an order for temporary injunction pending the hearing and determination of the application and a permanent injunction pending the hearing and determination of the suit, restraining the respondents from selling, dealing, interfering, alienating or disposing of all that parcel of land known as Land Title Deed Number L.R No. 1/1362 Flat No. B8 Image Luxury Apartment, Kiliani – Nairobi City County; Land Title Deed Number Machakos/Mua Hills/1884 Makongeni area, Kyaani Location Mua Hills- Machakos County; Land Title Deed Number Mitaboni/Mitaboni/5102 and Mitaboni/Mitaboni/2232 along Kenol - Kangundo Road Kinyau area in Machakos County hereinafter referred to as the subject properties. The applicant also seeks costs of the application. 3.After the filing of the Notice of Motion application dated 20th August 2025, this Court granted conditional orders on 22nd August 2025 and directed the applicant to deposit the sum of Kshs.1,000,000/= with the defendant within 21 days, failure to which the said Order would stand automatically vacated. The applicant did not comply with the Order made. Instead, it filed the second application seeking extension of the Court Order of 22nd August 2025 and costs of the application. 4.The two applications are supported by affidavits of Edward Mwanthi Kitavi sworn on 20th August 2025 and 3rd October 2025. Mr. Mwanthi averred that he is the Director of the applicant, which applied for and was granted loan facilities by the 1st respondent, that were secured by the subject properties. He stated that the loan was repaid but due to unpredictable hostile businesses the applicant defaulted. 5.He stated that the 2nd respondent advertised the subject properties for public auction which was due on 25th August 2025. He averred that the applicant has not refused to pay the loan as it has already paid Kshs.56,000,000/= out of the loan of Kshs.53,000,000/=. He deposed that the applicant seeks to have the loan restructured for repayment in affordable instalments so as to avoid the sale of his properties, which house his family who stand to be evicted. He urged this Court to grant the orders being sought herein. 6.In the second application, Mr. Mwanthi stated that in as much as the Court granted the applicant 21 days to comply with its Orders, due to unforeseen circumstances, it was not possible to comply. He stated that one of the Guarantors had agreed to offset a sum of Kshs.4,000,000/= within 150 days. He prayed for this Court to extend the said Order, as it will enable compliance. 7.He further stated that the 2nd respondent had caused re-advertisement of the subject properties, whose auction was slated for 9th October 2025. He reiterated his willingness to repay the loan once a loan restructure was approved so as to salvage his properties and avoid his family being evicted. 8.In opposition to the applications, the 1st respondent filed replying affidavits sworn on 17th September 2025 and 9th October 2025 by Mr. Edwin Karume and Ms Jackline Ndung’u, respectively. 9.Mr. Karume deposed that the 1st application is frivolous, baseless and ought to be dismissed. He stated that the applicant applied for, and was granted various loan facilities secured by legal charges over the subject properties and it was required to repay the same, but breached the repayment terms. He stated that the 1st respondent then issued a demand letter dated 16th January 2023, but the loan was restructured vide a Letter of Offer dated 1st February 2023 so as to consolidate the facility into one. He averred that the applicant once again defaulted and a 90 days’ Statutory Notice dated 3rd November 2023 and a 40 days’ Notice dated 7th February 2023, were issued. 10.Mr. Karume claimed that due to the continued default, the 2nd respondent was instructed through a letter dated 21st March 2024 to issue a 45 days’ Redemption Notice and Notification of Sale. He stated that one of the Guarantors filed MCELC No. E292 of 2024, which was dismissed for want of jurisdiction, and he also filed Machakos MCCOMMSU No. E389 of 2024, which is still pending. He deposed that the outstanding amount is Kshs.64,975,267.56, and that the applicant’s reference to Covid 19 and unpredictable foreseen business as excuses for not repaying the loan, were not part of the contract. He prayed for the application to be dismissed. 11.In the second application, Ms Ndungu deposed that the Court issued a conditional order which the applicant did not comply with, in the required 21 days and the Order was automatically vacated on 12th September 2025. She averred that the suit properties were advertised for auction for 9th October 2025, which prompted the applicant to file the second application seeking similar prayers. She stated that since the Court Order was vacated, there is no Order to extend. She further stated that since the first application was already determined, the second one offends the doctrine of res subjudice since it seeks similar orders, thus it ought to be dismissed. 12.The applications were canvassed by way of written submissions. The applicant’s submissions dated 28th November 2025 were filed by the law firm of Mwanzia Kyule & Associates Advocates, whereas the 1st respondent’s submissions dated 1st December 2025 were filed by the law firm of Mulanya & Maondo Advocates. 13.Mr. Kyule, learned Counsel for the applicant, submitted that the interim injunction orders granted should be confirmed pending the hearing and determination of the suit. He relied on Order 40 Rule (1) of the Civil Procedure Rules, Section 89(1) of Land Act, the cases of Esta Kuto v Ms Oriental Bank Ltd & 2 others [2016] eKLR, and Francis Jumba Enziano and others vs Bishop Phillip Okeyo and others Nairobi HCCC No. 1128 of 2001, to bolster his submissions. 14.He stated that the applicant has established prima facie case with high chances of success, and that it will suffer irreparable loss which cannot be compensated by damages and that the balance of convenience is in favour of the applicant, since it has repaid the sum of Kshs.56,000,000/=, which is Kshs.3,000,000/= above the loan amount of Kshs.53,000,000/=. Counsel reiterated that the applicant is willing to repay the loan once the same is restructured to a reasonable amount so that it can avoid default. 15.Mr. Onyango, learned Counsel for the 1st respondent contended that the applicant has not fulfilled the grounds to warrant being granted an injunction in line with the case of Giella V Cassman Brown & Company Ltd [1973] EA 358. He submitted that the applicant does not have prima facie case as defined in the case of Mrao v First American Bank of Kenya Ltd & 2 others [2003] eKLR, since it has not disputed that it obtained the loan facilities and defaulted, prompting the Notices in issue. He submitted that the fact that loan is disputed is not a ground to warrant an injunction to issue. He relied on the case of Scholastica Nyaguthii Muturi v Housing Finance Co. of Kenya [2017] KEHC 7830 (KLR) and Villa Care Limited & another v Stanbic Limited (Commercial Case E265 of 2022) [2022] KEHC 10032 (KLR). He argued that the applicant apart from stating that it was willing to repay the loan, had not demonstrated how it would do so. He urged this Court to dismiss the application, since the first limb had not been fulfilled. He cited the case of Naftali Ruthi Kinyua v Patrick Thuita Gachure & another (2015) eKLR, to support his submissions. 16.Counsel argued that since a prima facie case has not been established, the condition for irreparable injury cannot stand. He cited the cases of Nguruman Limited vs Jan Bonde Nielson & 2 others [2014] eKLR, Andrew Muriuki Wanjohi vs Equity Building Society Ltd & 2 others [2006] eKLR and Kitur vs Standard Chartered Bank & 2 others (2002) IKLR, to support his position. 17.Counsel also cited the case of Pius Kipchirchir Kogo v Frank Kimeli Tenai [2018] eKLR, and asserted that the balance of convenience tilts in the 1st respondent’s favour since it granted the applicant the loan facilities but it defaulted. He thus urged this Court to dismiss the application with costs. Analysis And Determination. 18.I have considered the instant application, the grounds on the face of it and the affidavits in support thereof. I have also considered the replying affidavit and the written submissions by Counsel for the parties. The issues that arise for determination are: -a.Whether the plaintiff is entitled to being granted a temporary injunction.b.Whether interim orders should be extended. 19.Temporary injunctions are provided for under Order 40 Rule 1 of the Civil Procedure Rules, 2010, which states that: -1.Where in any suit it is proved by affidavit or otherwise: -a.that any property in dispute in a suit is in danger of being wasted, damaged, or alienated by any party to the suit, or wrongfully sold in execution of a decree; orb.that the defendant threatens or intends to remove or dispose of his property in circumstances affording reasonable probability that the plaintiff will or may be obstructed or delayed in the execution of any decree that may be passed against the defendant in the suit,the court may by order grant a temporary injunction to restrain such act, or make such other order for the purpose of staying and preventing the wasting, damaging, alienation, sale, removal, or disposition of the property as the court thinks fit until the disposal of the suit or until further orders. 20.In an application for an interlocutory injunction, the applicant bears the burden to satisfy the Court that it should grant such an order. The Court of Appeal in the case of Nguruman Limited v Jan Bonde Nielsen & 2 others (supra), relied on the principles established in the Giella v Cassman Brown & Co Ltd (supra) and held as follows: -“In an interlocutory injunction application, the applicant has to satisfy the triple requirements to;(a)establish his case only at a prima facie level,(b)demonstrate irreparable injury if a temporary injunction is not granted, and(c)ally any doubts as to (b) by showing that the balance of convenience is in his favour.” 21.The Court of Appeal in the case of Mrao Ltd v First American Bank of Kenya Ltd & 2 others (supra), considered what constitutes a prima facie case and stated as follows: -“So what is a prima facie case, I would say that in civil cases, it is a case in which on the material 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 to call for an explanation or rebuttal from the latter.A prima facie case is an arguable case. It is not sufficient to raise issues but the evidence must show an infringement of a right and the probability of success of the applicant’s case upon trial. That is clearly a standard, which is higher than an arguable case”. 22.This Court has been called upon to determine whether the rights of the applicant have been infringed by the respondents in order to establish whether they have a prima facie case or not. It is not in dispute that the applicant obtained various credit facilities from the 1st respondent which were secured by the subject properties. The applicant has admitted being in default of the said loan facilities which were occasioned by the effect of the Covid 19 Pandemic, the Russia-Ukraine war and other unpredictable business factors. The applicant stated that it is ready and willing to repay the loan once the loan is restructured to reasonable terms, so as to avoid further default. 23.The 1st respondent on its part argued that the applicant having obtained the loan facilities secured by the subject properties defaulted, which fact the applicant has admitted. 24.Parties to a contract are bound by its terms. In the case of William Kazungu Karisa v Cosmas Angore Chanzera [2006] eKLR, the Court held that: -“The basic rule of the law of contract is that the parties must perform their respective obligation in accordance with the terms of the contract executed by them”. 25.It is also trite that Courts cannot rewrite a contract and, in this case, it cannot order a loan restructure as this can only be determined by the parties. In the case of National Bank of Kenya Ltd v Pipe Plastic Samkolit (K) Ltd and another (2001) eKLR, the Court held thus-“A court cannot rewrite a contract between parties. The parties are bound by the terms of their contract unless coercion, fraud and undue influence are pleaded or proved.” 26.A Court should not grant an injunction where the debt has been admitted. The applicant in this case admitted to being indebted to the 1st respondent. This Court is guided by the Court of Appeal decision In Giro Commercial Bank Limited v Halid Hamad Mutesi [2002] eKLR, which held as follows: -“It has been held time and again that a mortgagee cannot be restrained from exercising his power of sale because the amount due is in dispute or that the mortgagee has commenced a redemption action or because the mortgagor objects to the manner in which the sale is being arranged. In that case, where the debt is admitted as due and the loan is not being serviced, the court should not grant an injunction.” 27.It is this Court’s considered view that the applicant having admitted being indebted to the 1st respondent and having not raised any issue on the procedure followed by the respondents on the Notices issued or advertisement for public auction or on the intended public auction, it has not established that it has a prima facie case with a probability of success. 28.It is not enough for Mr. Mwanthi, the applicant’s Director to aver that the subject properties if sold will cause his family to be evicted from their home. This is because once the subject properties were availed to the 1st respondent as securities, they obtained commercial value and lost their sentimental value, given that it was a term of the contract that the said properties were to serve as securities and in the event of default, they would be sold. See Andrew M. Wanjohi v Equity Building Society & another (2006) eKLR, where the Court held inter alia:-“… by offering the suit property as security the chargor was equating it to a commodity which the chargee may dispose of, so as to recover his loan together with the interest thereon.” 29.In view of the fact that the applicant has admitted the debt, it stands to suffer no irreparable injury if the subject properties are sold. It is also my finding that given the circumstances of this case, the balance of convenience tilts in favour of the 1st respondent. 30.In the result, this Court finds that the Notice of Motion application dated 20th August 2025 lacks merits and it is hereby dismissed. It therefore follows that the Notice of Motion application dated 3rd October 2025 which was pegged on the former application is also dismissed. The respondents are awarded the costs of the two applications.It is so ordered. DATED, SIGNED AND DELIVERED AT KIAMBU ON THIS 8TH DAY OF MAY 2026.Ruling delivered through Microsoft Teams Online Platform.NJOKI MWANGIJUDGEIn the presence of:-Mr. Kyule for the plaintiff/applicantMr. Edwin Onyango for the defendants/respondentsMs Julia – Court Assistant.NJOKI MWANGI J.