https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/4989

**REPUBLIC OF KENYA** **IN THE ENVIRONMENT & LAND COURT AT NAIROBI** **ELC NO. E113 OF 2024** **\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_** **KHATOON MADATALLY REHEMTULLA - 1ST PLAINTIFF** **KARIM MADATALLY RAHEMTULLA** **BOGHA - 2ND PLAINTIFF** **VS** **CITY PARK PROPERTIES INVESTMENTS LIMITED - 1ST DEFENDANT** **NASEEM SADRUDIN ALI JINA - 2ND DEFENDANT** **AKBAR ALI LADHANI - 3RD DEFENDANT** **JUDGMENT** 1. The Plaintiffs commenced this suit vide the Plaint dated 4/3/2024 seeking that Judgment be entered against the Defendants in the following terms; 2. The Defendants to execute the Deed of Assignment, Share Transfer Form and Form D for the property known as Maisonette Number 7 in Hirani Estate located in LR Number 209/7573 (Original Numbers 209/2155/5) [hereinafter called the suit land] to the 2nd Plaintiff failing which the Deputy Registrar to execute all documents necessary to facilitate the transfer. 3. A declaration that the 2nd Plaintiff is entitled to a peaceful, quiet and lawful possession of the Property known as Maisonette Number 7 in Hirani Estate located in LR Number 209/7573 (Original Numbers 209/2155/5 and 209/1876), 3rd Parklands Avenue, Limuru Road and a storage warehouse devoid of any nuisance, harassment, threat and/ or interference from the Defendants. 4. A permanent injunction restraining the Defendants whether acting on their own-jointly or individually, through their respective agents, personal representatives, assigns, employees, or anyone howsoever from harassing, threatening the Plaintiff, trespassing onto, interfering and/ or evicting the Plaintiff from the Property known as Maisonette Number 7 in Hirani Estate located in LR Number 209/7573 (Original Numbers 209/2155/5 and 209/1876; 3rd Parklands Avenue, Limuru Road and a storage warehouse. 5. A permanent injunction restraining the Defendants whether acting on their own- jointly or individually, through their respective agents, personal representatives, assigns, employees, or anyone howsoever from harassing, threatening the Plaintiff's Donor, trespassing onto, interfering and/ or evicting the Plaintiff's Donor from the Property known as Maisonette Number 8 in Hirani Estate located in LR Number 209/7573 (Original Numbers 209/2155/5 and 209/1876), 3rd Parklands Avenue, Limuru Road and a storage warehouse. 6. A declaration that the 2nd and 3rd Defendants have failed to manage the company in accordance with the provisions of the Companies Act 2015. 7. General damages 8. Special damages 9. Costs of the suit 10. Interest on (f), (g) and (h) above at Court rates from 6/12/2020 till the determination of the suit. 11. Such further or other relief this Honourable Court may deem fit. 12. The Plaintiffs’ case is that the 1st Defendant is the management company responsible for administering an estate comprising 49 Maisonettes, with each unit allocated 62 ordinary shares in the company. The 1st Plaintiff owns Maisonettes Nos. 7 and 8 and consequently holds 124 shares. Pursuant to a Deed of Assignment executed in 2020, the 1st Plaintiff transferred Maisonette No. 7, together with the corresponding 62 ordinary shares in the 1st Defendant, to the 2nd Plaintiff, her son. By virtue of that assignment, the 2nd Plaintiff became entitled to ownership, occupation, quiet possession of Maisonette No. 7, and the enjoyment of all services provided within the estate. 13. The Plaintiffs aver that the Defendants have consistently acknowledged the 2nd Plaintiff as the beneficial owner of Maisonette No. 7, including in correspondence addressed to him. Despite this acknowledgement, the Defendants have allegedly unlawfully and without justification refused to facilitate the execution and registration of the Deed of Assignment, the transfer of the 62 ordinary shares, and the requisite transfer documents relating to Maisonette No. 7. The Plaintiffs contend that this refusal has unlawfully impeded the 2nd Plaintiff's enjoyment of his proprietary rights and his entitlement to the services provided by the management company. 14. The Plaintiffs further allege that the Defendants unlawfully withheld security and other estate services from the 2nd Plaintiff, resulting in break-ins at his storage premises on 2/10/2020 and 8/1/2021. They contend that the Defendants' conduct amounted to nuisance and unlawful interference with the Plaintiffs' quiet enjoyment of the property. The particulars of interference are stated as follows: refusing to effect the transfer of ownership and shares; directing security personnel to deny the 2nd Plaintiff access to the estate and security services; attempting to evict him from a storage facility; instructing persons purporting to be police officers to threaten his arrest and eviction; and refusing to facilitate the execution of the relevant transfer documentation for Maisonette 7. 15. The Plaintiffs also aver that the 2nd and 3rd Defendants failed to manage the affairs of the 1st Defendant in accordance with the Companies Act. The particulars of the failed management are: permitting discriminatory conduct against the 2nd Plaintiff, issuing unsupported statements of indebtedness, withholding essential estate services, and excluding him from the company's decision-making processes. It is further alleged that the 2nd and 3rd Defendants failed to safeguard his property, resulting in vandalism and insecurity. It is alleged that these actions subjected the 2nd Plaintiff to harassment, threats, restricted access to his property, and denial of essential residential services. 16. As a consequence of the Defendants' alleged breaches of duty and wrongful conduct, the Plaintiffs state that they have suffered stress, anxiety, inconvenience, and additional expenses, including the cost of private waste collection services and legal representation. They maintain that they have sustained loss and damage and have been greatly injured. **The Statement of Defence and Counterclaim** 1. The Defendants vehemently opposed the Plaintiffs’ claim in the Defence and Counter-claim dated 30/4/2024. In their Defence, the Defendants deny that the 2nd Plaintiff is the Bottom of Form1st Plaintiff is the legal owner of Maisonette No. 7, maintaining that the 1st Plaintiff remains the registered owner because the intended transfer of shares to the 2nd Plaintiff, initiated in 2020, has never been completed or registered. They assert that although the 2nd Plaintiff has always occupied the Maisonette, he has never acquired legal ownership, as evidenced by correspondence issued in August and September 2020 recognising only the 1st Plaintiff as the registered owner and expressly stating that the 2nd Plaintiff is neither a shareholder nor an owner. They therefore deny the Plaintiffs' allegations regarding ownership and contend that the transfer documentation has not been executed because the Plaintiffs have failed to satisfy the conditions precedent required for transfer. 2. The Defendants further contend that Hirani Estate operates as a gated community governed by Rules and Regulations binding on all homeowners and residents, including the obligation to contribute service charges and related expenses necessary for the management of the Estate. They aver that the Plaintiffs have, for over ten years, failed to pay service charges, borehole water charges, contributions towards land rates, land rent, insurance premiums and other communal expenses in respect of Maisonette No. 7, resulting in arrears amounting to Kshs. 3,149,717.86 as at 4/4/2024. They assert that, while the 1st Plaintiff remains compliant in respect of another property, Maisonette No. 8, she has deliberately defaulted in relation to Maisonette No. 7. Consequently, the Defendants maintain that they cannot consent to the transfer of the property until all outstanding charges are settled, and that the 2nd Plaintiff is entitled to the full range of Estate services only upon payment of the outstanding arrears. 3. The Defendants deny all allegations of withholding security services, creating a nuisance, interfering with the Plaintiffs' enjoyment of the property, or unlawfully dealing with the rented store. They maintain that security services, insurance and other communal amenities cannot be selectively withheld within the gated community, and assert that Maisonette No. 7 has continuously benefited from those services. They instead allege that the 2nd Plaintiff obstructed the installation of the Estate's CCTV system on 7/7/2020 by chasing away the technicians and refusing to permit the routing of CCTV wiring near his property, thereby compelling the Estate to reroute the installation at an additional cost of Kshs. 50,000/-. They further deny that the rented store was broken into on the dates alleged, deny all pleaded particulars of nuisance and interference, and reiterate that any refusal to approve the transfer of Maisonette No. 7 arises solely from the Plaintiffs' persistent failure to clear outstanding service charge arrears and related obligations. 4. The Defendants unequivocally deny the Plaintiffs’ allegations of misconduct, including any instruction to police officers to threaten the 2nd Plaintiff, and put the Plaintiffs to strict proof. They contend that the 2nd Plaintiff has exhibited persistent obstinacy, lack of cooperation, and an absence of communal spirit, as particularised in the Defence. Notably, the 2nd Plaintiff has refused to pay service charges and related expenses for Maisonette no. 7 since 2011, despite the 1st Plaintiff’s compliance in respect of Maisonette no. 8, and has rebuffed numerous entreaties from the Defendants, fellow homeowners, residents, and even Ismaili Muslim community mediators. Further, the 2nd Plaintiff is alleged to have obstructed the installation of CCTV systems, threatened technicians, refused to vacate a rented store to facilitate urgent and long-overdue repairs (unlike other co-operative tenants), evaded garbage collection fees by exploiting the 1st Plaintiff’s collection point, and generally opposed developmental initiatives for the estate while exhibiting hostility towards neighbours and staff. 5. The Defendants further deny that they have adversely affected the 1st Plaintiff, who is approximately 90 years old, and assert that it is the 2nd Plaintiff’s refusal to pay service charges and his uncooperative conduct that would more likely prejudice her well-being. They maintain that any damage allegedly suffered by the Plaintiffs is self-inflicted and reiterate their willingness to consent to the transfer of Maisonette no. 7 upon full settlement of all outstanding service charges and related expenses. 6. The Defendants contend that the Plaintiffs’ prayers are fundamentally unsustainable and warrant dismissal. They assert that Prayer (a) is premature, as the Plaintiffs have not cleared outstanding service charges and related expenses owed to the 1st Defendant. With respect to Prayers (b), (c), and (d), the Defendants argue that these are misconceived, since there has been no attempt to interfere with the 2nd Plaintiff’s possession of Maisonette no. 7; rather, the Defendants’ sole concern is the recovery of arrears. Additionally, the 2nd Plaintiff has no legal entitlement to a store within the estate, as such allocations are made on a first-come-first-served basis and subject to prompt payment of monthly rent to the 1st Defendant. Prayer (e) is also opposed for lack of evidentiary support, as the Plaintiffs have adduced no proof that the 2nd and 3rd Defendants have mismanaged the 1st Defendant in contravention of the Companies Act. 7. Regarding Prayer (f), the Defendants submit that general damages are not recoverable in actions founded on breach of contract. Prayer (g) for special damages is similarly untenable, as the Plaintiffs have neither pleaded nor particularized a specific quantifiable sum. As to Prayer (h), the Defendants maintain that costs follow the event, and thus the Plaintiffs would only be entitled to costs if successful, a prospect they deem unlikely. Furthermore, any claim for interest on general or special damages must fail, as the underlying damages are not awardable. Interest on costs may only arise if costs are granted to the Plaintiffs, which, in the Defendants’ view, remains improbable. 8. In their Counterclaim, the Defendants being the management company of Hirani Estate, aver that their suit is in respect of unpaid service charges for Maisonette No. 7. They reiterate their assertion that the 1st Plaintiff is the registered proprietor of both Maisonette No. 7 and Maisonette No. 8 within the estate, with the 2nd Plaintiff, being her son, occupying Maisonette No. 7. While no arrears are owed regarding Maisonette No. 8, the Plaintiffs have consistently failed and/or neglected to pay service charges for Maisonette No. 7, contrary to their obligations under Clause 14.1 of the estate's rules and regulations. 9. As at 4/04/2024, the outstanding service charge arrears and related expenses amount to Kshs. 3,149,717.86. The Defendants aver that despite repeated demands and a notice of intention to sue, the Defendants have refused, failed, or neglected to settle the said sum. The Plaintiff contends that the Defendants, being of considerable means, have willfully declined to honour their financial obligations, thereby undermining the collective maintenance framework of the estate. 10. The Defendants further aver that the Plaintiffs default has caused significant cash flow constraints and has adversely affected the morale of other homeowners, who continue to pay their charges while the Plaintiffs enjoy the same services without contribution. That they are apprehensive that such non-payment may set a precedent, potentially paralyzing essential estate services. It is for the foregoing reason that the Counterclaimants pray for orders that; 11. Kshs. 3,149,717.86 as at 04/04/2024 together with further penalty interests at the rate of 6% per quarter from 04/04/2024 until payment in full. 12. The Defendants do pay all the service charges and other related expenses in respect of Maisonette no. 7 that will accrue during the pendency of these proceedings together with penalty interest thereon at the rate of 6% per quarter in accordance with Clause 16.2 of the Hirani estate Homeowners and Residents Rules and Regulations, 2020. 13. An Order directing the Defendants to promptly pay such future service charges, other related charges and penalties as may be determined by the Plaintiff within 7 days of being notified by the Plaintiff failing which the Plaintiff will be deemed free to execute as against the Defendants for the service charges and other related charges owed without any further reference to this Honourable Court. 14. An Order directing the Plaintiffs to exhibit better conduct towards fellow homeowners, residents and the management of Hirani estate thereby facilitating smoother service delivery. 15. Costs of the main Suit and the Counterclaim together with interest thereon at Court rate from the date of Judgment until payment in full. 16. Such further relief as this Honourable Court may deem fit and reasonable to grant. **The Amended Defence to Counterclaim** 1. In their amended Defence dated 14/8/2024, the Plaintiffs aver that unequivocally deny the allegations contained in paragraphs 35, 36, 37, and 38 of the Counterclaim, putting the Counterclaimants to strict proof thereof. They further contend that the Defendants’ claim for service charge up to the year 2024 is contradictory, as the Defendants admittedly withdrew services for both House No. 7 and House No. 8 as of 26/8/2020. Additionally, the Plaintiffs Defendants raise a preliminary objection under Section 4 of the Limitation of Actions Act, asserting that portions of the sums sought are statute-barred, having accrued more than six years prior to the filing of the claim, and therefore ought to be struck out. 2. The Plaintiffs contend that the Defendants’ directors have acted ultra vires and without proper appointment under the Companies Act, rendering their decisions arbitrary and illegitimate. They maintain that the Counterclaimants have persistently denied essential services including water supply, garbage collection, and access to common amenities to both properties, despite the Plaintiffs having fully paid the service charge for House No. 8 and the 2nd Plaintiff being in occupation of House No. 7. They accuse the Defendants of unreasonably withholding consent to transfer ownership of House No. 7 from the 1st to the 2nd Plaintiff, and that the service charges claimed are excessive and unlawfully imposed. 3. The Defendants assert that the reliefs sought in the Counterclaim, particularly prayers (a), (b), (c), and (d), are legally unsustainable, frivolous, and vexatious. They contend that prayers (a)–(c) amount to an unlawful attempt at financial extortion, while prayer (d)—seeking an order to compel better conduct is nonsensical and devoid of any legal foundation. They argue that the Counterclaim is an abuse of judicial process, designed to harass them without legitimate basis. They urge the Court to strike out the counterclaim in its entirety with costs. **Reply to Defence to Counterclaim** 1. The Defendants, counterclaimants herein, filed their reply to Defence to Counterclaim dated 6/2/2025. The Defendants deny that their Counterclaim is incompetent and refutes the allegations of withdrawal of services from Maisonettes Nos. 7 and 8. They maintain that common services (security, insurance, land rent/rates, lighting, CCTV, cleaning, administration, repairs, maintenance, accounts, audit) cannot be withheld from only two properties within the gated community, as evidenced by the insurance policy covering Maisonette No. 7. The Plaintiff further asserts that no services were withdrawn from Maisonette No. 8 because the 1st Plaintiff, as the owner and occupant thereof, does not owe arrears in respect of that property. 2. On the issue of limitation, the Defendants contend that no portion of the service charge is time-barred, as the charges are not severable but have accrued continuously and on a rolling basis throughout the Defendants' occupation and enjoyment of services. Additionally, the Plaintiffs' part-payments and repeated requests for statements of account constitute acknowledgments of indebtedness, which reset the limitation clock. The Defendants also deny withholding security services from the Defendants, as such services cannot be selectively withdrawn from a single property. 3. The Defendants further deny that its directors acted *ultra vires* or made illegal decisions. They assert that the Directors were properly appointed as evidenced by the requisite resolutions, minutes as well as a company search (CR 12) dated 30/7/2024 adduced herein. They assert that the Plaintiffs were invoiced the same amounts as other homeowners and supplied with itemized statements and that the service charge arrears are justified. The Defendants therefore prays that the main suit be dismissed with costs and judgment be entered in their favour as sought in the Counterclaim. **The evidence adduced at the hearing** 1. At the trial, Mr. Karim Madatally Rahemtuulla Bogha, the 2nd Plaintiff, testified as PW1. He relied on his Witness Statement dated 19/8/2024 as his evidence in-chief. He further produced the documents listed on the Plaintiffs’ List of Documents dated 20/9/2024 marked as P Ex No. 1-19 as well as the documents listed on the Plaintiffs’ Further List of Documents marked as P Ex No. 20-24 dated 16/9/2025. 2. In cross-examination, PW 1 reiterates the assertions as to the ownership of the two apartments by the 1st Plaintiff and her shareholding in the 1st Defendant. He stated that he lives in Unit No. 7 whereas the 1st Plaintiff lives in Apartment No. 8. He averred that the 1st Plaintiff, his mother intends to transfer apartment and shares to him. It was his evidence that service charge in respect of both apartments were paid by the 1st Plaintiff. He averred that the sums being claimed by the 1st Defendant are fictitious. He stated that the balance owed in respect to Apartment No. 8 is Kshs. 28,587/= and Kshs. 4,347, 484/= in respect of Apartment No. 7. He stated that he disputes the 1st Defendant’s computation of service charge. It was his testimony that he paid a sum of Kshs. 80,000/= on 21/10/2020 to the 1st Defendant. However, the payment was effected through a Cheque deposit slip, which he thinks must have been credited to the 1st Defendant’s account. 3. Regarding the Homeowners and Residents Rules & Regulations, PW1 argued that the Rules were not adopted at the Annual General Meeting (AGM). It was his evidence that the 1st Plaintiff transferred Apartment 8 to him but the transfer was not completed. He informed the Court that service charge is payable monthly or quarterly. He contended that he is not receiving any service to warrant him to pay the service charge. He argued that he collects his own garbage and was not aware if the property is insured. According to him, it is the 1st Defendant who is insured. 4. PW 1 testified that it is the 1st Defendant who should pay land rent and rates for the estate. He averred that they have security guards at the gate of the estate whom he confirms opens the gate for him. He stated that his garbage is also collected. It was his testimony that he paid service charge up to the year 2020. That as at 2/4/2020, the balance of the service charge was Kshs. 1,024,118.00/=. He avers that as per the Letter dated 26/8/2020, the 1st Defendant withdrew the services from him. 5. Referring to the Homeowners Rules, PW1’s confirmed that Clause 7.2 requires a clearance certificate from the 1st Defendant before transferring a unit whereas 16.2 provides that outstanding service monies attract 6 % interest. He confirmed that Rule 14.3 allows the withdrawal of services for service charge defaulters. He argued that the Rules are invalid for want of validation by shareholders although he was not one of them. He argued that the outstanding service charges were illegal. He stated that the installers of the CCTV were trespassing on his apartment. 6. In re-examination, he alleged that the services were withdrawn from them, that is; water and security. He confirmed that the Estate Rules were passed sometimes back but he could not tell when that was. He stated that although the Rules are dated 20/3/2020, the claimed service charge dates back to the year 2011. He stated that other than Kshs. 180,000/=, he does not owe any monies to the 1st Defendant. 7. With that, the Plaintiffs closed their case. 8. Naseem Sadrudin Ali Jina, the 2nd Defendant herein, testified as DW1. She relied on her Witness Statement dated 14/8/2024 as his evidence in-chief. She also adduced the documents listed on the Defendants’ List of Documents dated 14/8/2024. The documents were marked as DEX No. 1- 18. It was her testimony that the outstanding service charge was Kshs. 4,347,484.86 as at September, 2025. She confirmed that there were no monies owing with regard to Apartment No. 8. She stated that default of service charge attracts 60% per quarter or 2% per month. 9. During cross-examination, DW 1 stated that she has been the 1st Defendant’s Director since 2019 and has been re-elected since then. She averred that they held AGMs annually. That the 6% interest was passed in the 2024’s AGM. She confirmed that she declined to sign the Deed of Transfer because of the outstanding service charge which has not been paid for over 15 years. That negotiations have not yielded any fruits. That the 2nd Plaintiff who resides in Apartment 7 has only paid Kshs. 180,000/=. She avers that the 2nd Plaintiff stopped paying service charge since 2011 and 6% has been applied. DW 1 testified that they kicked the 2nd Plaintiff from the stores as he had entered thereon without permission and refused to open the store. 10. In re-examination, DW 1 stated that Apartment No.8 is up to date with service charge payments. That service charge in accordance with clause 7.2 of the Rules has to be paid before a transfer is executed by the 1st Defendant. 11. Onesmus Kyalo Mutua, the Company’s Accountant consultant, testified as DW 2. He relied on his Witness Statement dated 13/8/2024 as his evidence in-chief. 12. During cross-examination, DW 2 stated that out of the Kshs. 4.3 Million owing as per the statements, Kshs. 950,000/= is the principal sum whereas 2% is the monthly penalty on the outstanding service charge. He stated that he was not aware of the induplum rule. He stated that he gave the invoices to the Plaintiffs at the 2nd Plaintiff’s request. The witness averred that payment for quarter is around Kshs. 60,000/=; add penalties from 2004. The last payment by the Plaintiffs was in 2009. That penalty charged dates back to 2011. He asserted that it is only the Directors who could execute the transfer documents. 13. In re-examination, DW 2 averred that the service charge statements are given in hard copy to the flat owners. Upon delivery, flat owners pay the service charge. He asserted that flat No. 8 paid the penalty. The witness averred that to date, the Plaintiffs are yet to pay what they believe is due. 14. Counsel for the Defendants then closed their case. 15. At close of the hearing, the Court directed parties to file their respective written submissions. Parties complied. The Plaintiffs’ submissions are dated 18/12/2025 and Replying submissions dated 29/7/2026. The Defendants’ submissions on the other hand are dated 24/3/2026. 16. The Court has had a chance to read through the submissions and has taken them into account in its disposition. **Analysis and determination** 1. The Court has carefully considered the pleadings filed in this suit by both sides, the evidence adduced and the submissions filed which now form part of the Court’s records. The Court is of the view that the issues for determination in this case are; - 2. Whether the Defendants should be compelled to execute the requisite transfer documents in favour of the 2nd Plaintiff. 3. Whether the Plaintiffs’ are entitled to the reliefs sought in the Plaint. 4. Whether the Defendants’ counter-claim is merited; 5. Which orders should the Court issue in respect of the 1st Plaintiff’s application dated 9/7/2025; and 6. Which orders should Court issue in respect of costs? **Whether the Defendants should be compelled to execute the requisite transfer documents in favour of the 2nd Plaintiff** 1. It is not disputed that the 1st Plaintiff is the registered owner of Apartments No.7 and 8 in Hirani Estate located on LR Number 209/7573 (Original Numbers 209/2155/5) within Nairobi County. 2. The Plaintiffs’ allege that pursuant to a Deed of Assignment executed in 2020, the 1st Plaintiff transferred Maisonette No. 7 together with the corresponding 62 ordinary shares in the 1st Defendant to the 2nd Plaintiff, who is her son. They contend that the Defendants have unlawfully and without justification refused to facilitate the execution and registration of the Deed of Assignment, the transfer of the 62 ordinary shares and the requisite transfer documents relating to Maisonette No. 7. The Plaintiffs assert that this refusal has unlawfully impeded the 2nd Plaintiff's enjoyment of his proprietary rights and his entitlement to the services provided by the management company. They also accuse the Defendants of unlawfully withholding security and other estate services from the 2nd Plaintiff, resulting in break-ins into his storage premises. 3. The Defendants on the other hand deny that the 2nd Plaintiff is the legal owner of Maisonette No. 7, maintaining that the 1st Plaintiff remains the registered owner. That the intended transfer of shares to the 2nd Plaintiff initiated in the year 2020 was never been completed or registered. They assert that although the 2nd Plaintiff has always occupied the Maisonette, he has never acquired legal ownership thereof. They therefore deny the Plaintiffs' allegations regarding ownership and contend that the transfer documentation has not been executed because the Plaintiffs have failed to satisfy the conditions precedent required for registration. 4. The Defendants further contend that Hirani Estate operates as a gated community governed by Rules and Regulations binding upon all homeowners and residents, including the obligation to contribute service charges and related expenses necessary for the management of the Estate. They aver that the Plaintiffs have, for over ten years, failed to pay service charges, borehole water charges, contributions towards land rates, land rent, insurance premiums and other communal expenses in respect of Maisonette No. 7, resulting in arrears amounting to Kshs. 3,149,717.86 as at 4/4/2024. They assert that, while the 1st Plaintiff remains compliant in respect of another property, Maisonette No. 8, she has deliberately defaulted in relation to Maisonette No. 7. Consequently, the Defendants maintain that they cannot consent to the transfer of the property until all outstanding charges are settled and that the 2nd Plaintiff is only entitled to the full range of Estate services upon payment of the outstanding arrears. 5. The concept of sectional ownership as captured in the Sectional Properties Act, No. 21 of 2020 is that a building is divided into units to be owned by the individual proprietors. The individual proprietors however and in order to fully enjoy their proprietary rights own the common property including the land as tenants in common. That is why the statute provides that on registration of a section plan, the Registrar shall close the register of the parcel described in it and open a separate register for each unit described in the plan. The Registrar shall then, on payment of the prescribed fee issue in respect of each property, a certificate of lease if the property is leasehold and shall include its proportionate share in the common property. 6. It is trite law that a Court cannot interfere with the contract between parties unless invited and for a good reason, including fraud, undue influence and illegality. 7. In the case of National Bank of Kenya Ltd –vs- Pipeplastic Samkolit (K) Ltd & another [2001] eKLR the Court observed as follows: - “A Court of law cannot re-write a contract between the parties. The parties are bound by the terms of their contract, unless coercion, fraud or undue influence are pleaded and proved. There was not the remotest suggestion of coercion, fraud or undue influence in regard to the terms of the charge. 1. As was stated by Shah JA in the case of Fina Bank Limited –vs- Spares & Industries Limited (Civil Appeal No. 51 of 2000) (unreported): “It is clear beyond peradventure that save for those special cases where equity might be prepared to relieve a party from a bad bargain, it is ordinarily no part of equity’s function to allow a party to escape from a bad bargain”. 1. Section 3 of the Sectional Properties Act defines a Corporation as a body corporate incorporated in accordance with Section 17. Common property means so much of a parcel as is not comprised in a unit shown in a sectional plan. Section 17 provides for the establishment of the corporation whereas Section 20 provides for the duties of the corporation. The provision reads; 2. The Corporation shall; 3. subject to this Act, carry out any duties imposed on it by the by-laws; 4. unless by unanimous resolution all the proprietors otherwise resolve, insure and keep insured buildings and other improvements on the parcel against fire; 5. effect such other insurance as it is required by law to effect or as it may consider expedient; 6. pay the premiums in respect of any policies of insurance effected by it; 7. keep the common property in a state of good repair; 8. comply with any notice or order duly served on it by the county government or public body requiring repairs to, or work to be performed in respect of, the land or any building or improvements thereon; 9. subject to this Act, control, manage, and administer the common property and do all things reasonably necessary for the enforcement of the by-laws; 10. do all things reasonably necessary for the enforcement of any lease or licence under which the land is held; 1. do all things reasonably necessary for the enforcement of any contract of insurance entered into by it under this section; and 2. do all other things to ensure the property is well managed including engaging the services of a property manager or any other persons they deem necessary. 3. The Corporation shall; 4. establish and maintain a fund for administrative expenses sufficient, in the opinion of the Corporation, for the control, management, and administration of the common property, and for the payment of any insurance premiums, and the discharge of any other obligation of the Corporation; 5. determine from time to time the amounts to be paid for the purposes aforesaid; and 6. raise amounts so determined by levying contributions on the proprietors in proportion to the unit entitlement of their respective units. 7. The Corporation may, pursuant to a resolution of the proprietors, distribute any money or personal property in its possession and surplus to its current requirements among the proprietors for the time being according to their unit entitlements. 8. For the purposes of effecting any policy of insurance under the provisions of subsection (1) the Corporation shall be deemed to have an insurable interest on all the buildings and other improvements on the parcel. 9. Any policy of insurance authorized by this section and effected by the Corporation in respect of any buildings or other improvements on the parcel shall not be liable to be brought into contribution with any other policy, save another policy authorized by this section in respect of the same buildings or improvements. 10. The corporation may constitute an Internal Dispute Resolution Committee on a need basis to hear and determine disputes. 11. The Corporation may use technology in the execution of its duties. 12. The 1st Defendant herein is the corporation envisaged under the Act. The 1st Defendant is obligated to manage the common property. To do so, the company has to collect service charge from the shareholders who are the apartment owners. 13. Section 31 of the Sectional Properties Act allows the Corporation collect the funds from an owner for the execution of its mandate. It provides as follows; ‘Administrative expenses 1. In addition to other powers under this Act, the Corporation shall have the power to recover, from an owner, by an action in debt, any sum of money spent by the Corporation in execution of its duties as stipulated in Section 20.’ 2. From the CR 2 adduced herein, the 1st Plaintiff is a shareholder by virtue of her owning the two units. The 1st Plaintiff is therefore obligated to pay the service charge. It is evident that the 1st Plaintiff wishes to transfer unit 7 to the 2nd Plaintiff. The Plaintiffs’ accuse the Defendants of refusing to sign the requisite documents to effect the transfer. 3. The Defendants adduced the Homeowners and Residents Rules and Regulations dated 28/3/2020. The Rules govern the management of the said Estate. At Clause 7.2, the Rules states that; ‘No shareholder will be allowed to sell and transfer their property until a Clearance Certificate/Letter of all Service Charge paid in full is obtained from the Management Committee.’ 1. The Defendants have adduced invoices showing the 1st Plaintiff’s arrears in respect of the service charge for Apartment 7, where the 2nd Plaintiff resides. The Plaintiffs have not adduced evidence to rebut the Defendants’ position. Although the Plaintiffs rely on the Letter dated 26/8/2020 indicating withdrawal of services by the Company, PW 1 confirmed at trial that security guards open the gate for him. He further confirmed that CCTV cameras were installed on the property. Evidently, although the Defendants issued the notice for withdrawal of services pursuant to Rule 14.3 of the Estate Rules, the Plaintiffs still enjoy services accorded to other owners. It is not possible that the Plaintiffs can be blocked from enjoying certain services or accessing common areas which are managed by the Company. 2. He who alleges must prove. The burden of proof lay with the 1st Plaintiff to adduce evidence that she has paid the outstanding service charge and that the Defendants have declined to execute the documents to effect the transfer. Clearly, the Plaintiffs are in breach of their contractual obligations. The Plaintiffs have therefore not come to Court with clean hands to warrant the issuance of the equitable order sought. They have not done equity even as they seek it. **Whether the Plaintiffs’ are entitled to the reliefs sought in the Plaint.** 1. The Plaintiffs, in their Plaint, sought other prayers. I will address prayers (b), (c) and (d) together. The Plaintiffs seek a declaration that the 2nd Plaintiff is entitled to peaceful, quiet and lawful possession of Maisonette Number 7 and a storage warehouse. They also seek a permanent injunction restraining the Defendants from harassing, threatening, trespassing onto, interfering with and/or evicting the Plaintiff from the Property known as Maisonette Number 7, as well as a permanent injunction restraining the Defendants from harassing, threatening the Plaintiff's Donor, trespassing onto, interfering with and/or evicting the Plaintiff's Donor from the Property known as Maisonette Number 8 in Hirani Estate. 2. Based on my findings on the first issue, the Court lacks the basis upon which to grant the said orders. Although the 2nd Plaintiff is in occupation of Apartment No. 7, the transfer process is yet to be completed. The 2nd Plaintiff is therefore not yet to acquire proprietary rights thereon to warrant the Court’s intervention. In any case, the 2nd Plaintiff, not being a home owner, shareholder or director of the company, is a stranger to the company, and orders cannot be issued to a party who lacks locus standi. The other prayers are equally declined. 3. Regarding prayer (e), which declares that the 2nd and 3rd Defendants have failed to manage the company in accordance with the provisions of the Companies Act 2015, the 2nd and 3rd Defendants were elected by the Shareholders at the Annual General Meeting. The Plaintiffs have not adduced evidence of the directors' misconduct to justify the issue of such an order. In any case, such an issue can be raised at the meeting with the other shareholders. 4. As for General damages, it settled law that general damages are not recoverable in cases of alleged breach of contract. In the case of Kenya Tourist Development Corporation -vs- Sundowner Lodge Limited (2018) eKLR, the Court was categorical that, “As a general rule general damages are not recoverable in cases of alleged breach of contract and that has been the settled position of law in our jurisdiction, and with good reasons. In Dharamshi –vs- Karsan (1974) EA 41, the former Court of Appeal held that general damages are not allowable in addition to quantified damages with Mustafa Judge expressing the view that such an award would amount to duplication …” 1. The Plaintiffs have also prayed for special damages. However, the Plaintiffs have not pleaded or specified the amount sought, nor have they proved the said claim. The law on special damages is well spelt out. Special damages must not only be specifically pleaded but must also be strictly proved. 2. Accordingly, the Plaintiffs suit fails in its entirety. They are not entitled to any of the prayers sought in their Plaint. **Whether the Defendants’ counter-claim is merited** 1. In their Counter-claim, the Defendants aver that, whereas there are no arrears in respect of Maisonette No. 8, the Plaintiffs have consistently failed and/or neglected to pay service charges for Maisonette No. 7, contrary to their obligations under Clause 14.1 of the estate's rules and regulations. That, as at 4/42024, the outstanding service charge arrears and related expenses amount to Kshs. 3,149,717.86. The Defendants further aver that, despite repeated demands and a notice of intention to sue, the Plaintiffs have refused, failed, or neglected to settle the said sum. 2. Pursuant to Clause 14.1 of the Estate Rules, the service charge for the respective houses is payable monthly or quarterly, before the last day of each month or quarter. The Defendants adduced invoices and statements which confirm that the amount is owing. PW 1 stated at trial that the last service charge in respect of Apartment No. 7 was in August 2020. In the circumstances, I grant the amounts sought with interest at the rate of 6%, as provided in Clause 16.2, on penalty for late payment of the service charge until payment in full. 3. As for the other orders sought in the Counter-claim, I note that the prayers seek to ensure that the Plaintiffs pay the service charge in accordance with the rules. Having voluntarily executed the Lease Agreements, fully aware of the obligations arising therefrom, the Plaintiffs do not need a Court order to do what they are contractually obliged to do. **Which orders should the Court issue in respect of the 1st Plaintiff’s application dated 9/7/2025** 1. Before the hearing of the suit, the Plaintiffs filed an application dated 9/7/2025 seeking the following orders; 2. This Honourable Court be pleased to issue an order directing the Plaintiffs to deposit the sum of Kshs. 3,149,717.86/- into an interest-earning escrow account to be jointly operated by the parties’ Advocates, as a conditional safeguard to secure the Defendants’ counterclaim for alleged service charge arrears, pending the hearing and determination of the suit. 3. Upon compliance with Prayer 2 above, the Defendants to forthwith facilitate and execute all resolutions, consents, and instruments necessary to effect the transfer of shares and beneficial interest in Maisonette Number 7 in Hirani Estate, situated on L.R. No. 209/7573 (Original Numbers 209/2155/5 and 209/1876) from the 1st Plaintiff to the 2nd Plaintiff. 4. That the hearing of this Application be prioritized in light of the 1st Plaintiff’s age & deteriorating health. 5. That the costs of this application be provided for. 6. The 1st Plaintiff’s application is based on the face of it and on her affidavit of even date. The 1st Plaintiff sought to compel the transfer of House No. 7 to the 2nd Plaintiff despite the Defendants’ counterclaim for Kshs. 3,149,717.86 in alleged service charge arrears. The 1st Plaintiff, whose proprietary rights are undisputed, has offered to secure the full claimed sum in an interest-earning escrow account, but the Defendants have unreasonably rejected this proposal and have persisted in obstructing the transfer, thereby exacerbating the 1st Plaintiff’s clinically diagnosed adjustment disorder and risking further deterioration of her mental health. The relief sought is limited, reversible, and adequately safeguards the Defendants’ interests while preventing irreparable harm to the 1st Plaintiff and upholding her constitutional rights to dignity and property under Articles 28 and 40 of the Constitution. 7. The application was opposed by the Defendants by the Grounds of Opposition dated 23/9/2025 and the Replying Affidavit of Naseem Sadrudin Ali Jina dated 30/9/2025. The Defendants assert that granting it would fundamentally alter the nature of the dispute from a land matter to a debt-recovery claim, thereby ousting the Court’s jurisdiction. They argue that doing so would offend the Defendants’ right to a fair hearing by effectively granting the Plaintiffs judgment without a trial on the merits. They contend that the application is procedurally misplaced under Order 40, rule 11, and that the Plaintiffs’ proper recourse lies in expediting the main suit rather than pursuing interlocutory relief that would only cause delay and prejudice. The Defendants further argue that the Plaintiffs have come to equity with unclean hands, having failed to clear outstanding service-charge arrears, and that any deposit ought to be paid unconditionally to the 1st Defendant to meet estate obligations. Consequently, they submit that the application is devoid of merit and ought to be dismissed with costs. 8. On 1/10/2025, the Court directed that the application be held in abeyance pending the hearing and determination of the suit. Based on the Court’s finding that the Defendants’ counter-claim is meritorious, the 1st Plaintiff’s application is now spent. **What orders should issue on costs?** 1. Undoubtedly, the Court has discretion as to whether costs are payable by one party to another, the amounts of costs and when they are to be paid. This discretion must be exercised judicially; it must not be exercised arbitrarily. 2. In the case of Mayfair Holdings limited –vs- Ahmed (1990) eKLR, the Court of Appeal cited with approval the holding by the Court in the English Case of Ritter –vs- Godfrey (1920) 2KG 47, where the Court (Lord Dale M.R) stated that, “There is a settled practice that in the absence of special circumstances, a successful litigant should receive his costs, that it is necessary to show some ground for exercising discretion by refusing an order which would give them to him. The discretion must be judiciously exercised, and therefore there must be some grounds for its exercise, for a discretion on no grounds cannot be judicial.” 1. Section 27 of the Civil Procedure Act provides that costs shall follow the event unless there are good reasons to do otherwise. 2. Having succeeded in their counter-claim, the Defendants are awarded the costs of the main suit, the counter-claim and the 1st Plaintiff’s application against the Plaintiffs. **Final disposition** 1. Consequently, the Court issues the following orders: - 1. The Plaintiffs case is dismissed in its entirety. 2. The Defendants’ Counter-claim is allowed, and the Plaintiffs are ordered to pay Kshs. 3,149,717.86 as at 04/04/2024, together with further penalty interest at the rate of 6% per quarter until payment in full. 3. The costs of the suit, the counter-claim and the application are awarded to the Defendants against the Plaintiffs. 2. It is so ordered. **DELIVERED, DATED AND SIGNED AT NAIROBI THIS 30TH DAY OF JULY 2026 VIA MICROSOFT TEAMS.** **J. G. KEMEI** **JUDGE** **Delivered virtually in the presence of:** 1. Mr. Ochieng for the Plaintiffs 2. Mr. Otieno for the Defendants 3. CA- Mr. Amos