[2019] KEHC 7899 (KLR)
The court found that the plaintiff had previously entered into a consent order with the defendant in a related matter, agreeing to pay monthly instalments and permitting the defendant to realize its securities upon default. The plaintiff failed to disclose this consent when seeking ex-parte relief and admitted...
Source-derived case information.
- Citation
- [2019] KEHC 7899 (KLR)
- Parties
- Plaintiff: Samuel Gathu Kamau; Defendant: Equity Bank (K) Limited
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Commercial Courts)
- Jurisdiction
- Kenya
- Case Number
- Civil Case 32 of 2018
- Procedural Posture
- Civil Suit / Ruling on Interlocutory Injunction
- Outcome
- application dismissed with costs to the defendant
- Judges
- MM Kasango
- Legal Topics
- Injunctive Relief, Statutory Power of Sale, Loan Default, Consent Orders
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Samuel Gathu Kamau
Plaintiff
Equity Bank (K) Limited
Defendant
Procedural Posture
Civil Suit / Ruling on Interlocutory Injunction
Legal Issues
- 1 Whether the plaintiff is entitled to an interlocutory injunction restraining the defendant from exercising its statutory power of sale over the charged properties.
- 2 Whether the plaintiff's non-disclosure of a prior consent order affects his entitlement to equitable relief.
- 3 Whether the dispute over interest rates and valuation justifies injunctive relief despite admitted default.
Ratio Decidendi
The court found that the plaintiff had previously entered into a consent order with the defendant in a related matter, agreeing to pay monthly instalments and permitting the defendant to realize its securities upon default. The plaintiff failed to disclose this consent when seeking ex-parte relief and admitted default in payment. The issues raised in the present application were already addressed in the prior suit. The court held that the plaintiff failed to establish a prima facie case with a probability of success, as required for the grant of an interlocutory injunction. The non-disclosure of material facts and the existence of a binding consent order disentitled the plaintiff to...
Court Disposition
application dismissed with costs to the defendant
Orders
- The Notice of Motion dated 25th January 2018 is dismissed with costs to the defendant.
Full Case Text
Judgment text and source record
32 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA AT NAIROBI
MILIMANI COMMERCIAL & TAX DIVISION
HCCC NO. 32 OF 2018
SAMUEL GATHU KAMAU ..................................................PLAINTIFF
VERSUS
EQUITY BANK (K) LIMITED .........................................DEFENDANT
RULING
1. The Plaintiff’s Notice of Motion dated 25th January 2018 is for interlocutory injunction to restrain the Defendant from selling, by public auction, two properties, namely L.R. NO. Muguga/Gitaru/365andKiambaa/Kihara/6071 pending determination of this suit. The auction sale was scheduled for 26th January 2018, now past.
2. The Defendant does not deny that the Defendant advance him loans from time to time which loans were secured by legal charges on the two properties. What he however raises as grounds to support his prayer for injunction is his allegation that he Defendant charged him unconscionable rates of interest, that the Defendant failed to serve him with Statutory Notice; and that the Defendant had failed to carry out a valuation of the property.
3. It transpired, when the Defendant filed its replying Affidavit, that the Plaintiff had previously filed another case where he pleaded the same facts as in this matter. That matter as case HCCC NO. 205 OF 2017 SAMUEL GATHU KAMAU –VS- EQUITY BANK (K) LTD, ROBERT WAWERU MAINA T/A ANTIQUE AUCTIONEERS AGENCIES. That suit was compromised by consent as follows:
“This matter coming up for hearing on 21st November 2017 before the Honourable Mr. Justice Fred A. Ochieng. AND UPON HEARING the Counsel for the Plaintiff and the Counsel for the 1st and 2nd Defendants:
IT IS HEREBY ORDERED BY CONSENT:
1. That the Decree issued by this Court on 23rd May, 2017 be and is hereby varied in terms of Orders (2) and (3) thereof on the following terms:
(1) That the Plaintiff do pay the 1st Defendant the sum of Kshs 715,047/- per month towards repayment of the outstanding amounts with the first instalment payable on or before 10th December 2017 and thereafter on or before the 10th day of each succeeding month.
(2) That the Plaintiff be and is hereby at liberty to apply to the 1st Defendant for restructuring of the facilities after successful payment of three (3) months instalments under order (1) above subject to terms to be agreed between the parties.
(3) That the auction by the 2nd Defendant slated for 21st November, 2017 be and is hereby stopped and the auctioneers costs shall be paid by the Plaintiff as shall be agreed within 21 days and in default of any agreement the same be taxed..
(4) That a fresh valuation be undertaken on the suit properties by a valuer of the 1st Defendant’s panel of valuers and who shall be agreed between the Plaintiff and the 1st Defendant within 30 days. The costs for the said valuation shall be paid by the Plaintiff.
(5) That in default of payment of any instalment under order (1) above the 1st Defendant shall be at liberty to proceed with realization of the securities subject to compliance with the law.”
4. The existence of the above order was not disclosed by the Plaintiff when he first approached this Court for an ex-parte injunction. In other words the Plaintiff lacked utmost good faith when he came to Court ex-parte. That fact, on its own, is reason enough to deny the Plaintiff a hearing; see MRAO LTD –VS- FIRST AMERICAN BANK OF KENYA LTD & 2 OTHERS [2003] eKLR.
5. The issues raised by the Plaintiff, in the present application, were the same issues raised in the application in HCCC No. 205 of 2017. The Plaintiff, in that case, entered into a consent on settlement of the amount due to the Defendant. In that consent it was agreed that if the Plaintiff failed to pay the instalments, as agreed, the Defendant could proceed with the realisation of its security. The Plaintiff admitted, in this matter that he failed to pay his instalments when due.
6. The Plaintiff having not denied owing the Defendant and only states that the interest charged is unconscionable, an injunction cannot issue to restrain the Defendant from exercising its power of sale just because the amount due is in dispute.
7. The Plaintiff has failed to show prima facie case with probability of success. See GEILA –VS- CASSMAN BROWN & CO. LTD [1973] EA 358. Having so failed I will not proceed to consider the other principles of granting an injunction, enunciated in GEILLA –VS- CASSMAN BROWN CASE(SUPRA).
8. The Notice of Motion dated 25th January 2018 is devoid of merit and is therefore dismissed with costs to the Defendant.
9. Orders accordingly.
DATED, SIGNED and DELIVERED at NAIROBI this9THday of MAY,2019.
MARY KASANGO
JUDGE
Ruling ReadandDeliveredinOpen Courtin the presence of:
Sophie.................................... COURT ASSISTANT
............................................... FOR THE PLAINTIFF
.................................................FOR THE DEFENDANT