[2008] KEHC 1653 (KLR)
The court found that the charge in favour of the defendant was invalidated by the High Court order of 12.3.1997, which set aside the sale of the suit property. As a result, the defendant's security interest was extinguished, and it no longer had rights as a chargee over the property. The court determined that the...
Source-derived case information.
- Citation
- [2008] KEHC 1653 (KLR)
- Parties
- Plaintiff: Punda Milia Co-op. Society; Defendant: Savings & Loans (K) Ltd.
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Commercial Courts)
- Jurisdiction
- Kenya
- Case Number
- Civil Case 273 of 2008
- Procedural Posture
- Civil Case / Ruling on Originating Summons and Interlocutory Injunction
- Outcome
- Plaintiff's application allowed; injunction and declaration granted; Deputy Registrar authorized to execute discharge if necessary; defendant awarded costs.
- Legal Topics
- Injunctive Relief, Discharge of Charge, Invalid Charge, Property Possession, Sale of Land, Court Orders Enforcement
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Punda Milia Co-op. Society
Plaintiff
Savings & Loans (K) Ltd.
Defendant
Procedural Posture
Civil Case / Ruling on Originating Summons and Interlocutory Injunction
Legal Issues
- 1 Whether the defendant should be restrained from selling, transferring, or interfering with the suit property pending determination of the suit.
- 2 Whether a declaration should issue directing the defendant to discharge the charge registered against the suit property.
- 3 Whether the Deputy Registrar should be authorized to execute documents to effect discharge if the defendant fails to comply.
Ratio Decidendi
The court found that the charge in favour of the defendant was invalidated by the High Court order of 12.3.1997, which set aside the sale of the suit property. As a result, the defendant's security interest was extinguished, and it no longer had rights as a chargee over the property. The court determined that the applicant was entitled to an injunction restraining the defendant from interfering with the property, a declaration directing discharge of the charge, and, if necessary, execution by the Deputy Registrar. The respondent's remedy lies against the estate of the deceased debtor, not the property itself. The court emphasized that each case must be decided on its own facts and that...
Court Disposition
Plaintiff's application allowed; injunction and declaration granted; Deputy Registrar authorized to execute discharge if necessary; defendant awarded costs.
Orders
- An injunction restraining the defendant from transferring, disposing, or interfering with the plaintiff’s possession or ownership of the suit property is granted.
- A declaration is issued directing the defendant to discharge the charge registered in its favour against L.R. 209/138/44.
Full Case Text
Judgment text and source record
19 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA
AT NAIROBI (MILIMANI COMMERCIAL COURTS)
Civil Case 273 of 2008
PUNDA MILIA CO-OP. SOCIETY ……..…………………PLAINTIFF
VERSUS
SAVINGS & LOANS (K) LTD. ………………………… DEFENDANT
R U L I N G
Originating summons dated 22/5/08 seeking orders to restrain the respondent from selling, alienating, transferring, interfering or dealing with premises known as L.R.209/138/44 on the ground that the applicant stands to suffer irreparable loss if orders sought are not granted. The application is supported by affidavit of Joseph Wanyoike Ngaruiya, Chairman of the plaintiff society which shows that the subject matter of suit is valued at Kshs.75 million but it was sold under dubious circumstances by the City Council for Kshs.3,000,000/=. That sale was set aside on 12/3/1997. That by that time the respondent had secured a charge to secure a loan of Kshs.3. 5 million. That the purchaser of the property died in September 2005 and no substitution has been made in this matter and therefore any suit against her has abated.
It is feared that the respondent intends to sell the property by private treaty. This would be contrary to the judgment dated 12. 3.1997 by High Court and Case No.234/1996. An appeal against that judgment was struck out as incompetent Civil Appeal No.98 of 1997.
Upon reading the affidavits filed by both parties my answer to questions protest under Originating Summons dated 22/5/2008.
No.1 - in the circumstances disclosed the injunction restrains the defendant transferring, disposing or in any manner interfering with the plaintiff’s possession or ownership of suit property must issue and I grant the same.
No.2 – a declaration should issue against the respondent directing it to discharge the charge registered in its favour against suit property No. L.R. 209/138/44. I hereby make such declaration.
No. 3 – should the respondent fail to comply with orders for discharge of charge the Deputy Registrar of High Court is hereby authorized to execute all documents to effect discharge of the aforementioned charge. I hereby order and authorize the Deputy Registrar to execute and ………………
No.4 – the respondent shall have the costs of this suit. It is so ordered. The reasons are that when the orders of High Court were issued on 12. 3.1997 the charge in favour of the respondent was invalidated and therefore the respondent’s loan to the third party was left unsecured. The respondent can follow the estate of the deceased debtor but has no rights of a chargee.
I have perused the authorities tendered by the parties and I am of the view that each case is to be decided on its own merits. I find the facts of this case are supporting the orders hereby made.
DATED and DELIVERED at Nairobi this 28th day of August 2008.
JOYCE N. KHAMINWA
JUDGE