[2022] KEHC 16254 (KLR)

Tikoo & Company Limited & 2 others v I & M Bank Limited & another (Commercial Case E466 of 2022) [2022] KEHC 16254 (KLR) (Commercial and Tax) (8 December 2022) (Directions)

Neutral citation: [2022] KEHC 16254 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Commercial Courts Commercial and Tax Division)

Commercial and Tax

Commercial Case E466 of 2022

DO Chepkwony, J

December 8, 2022

Between

Tikoo & Company Limited

1st Plaintiff

Chetan Ranmal Haria

2nd Plaintiff

Heman Ranmal Haria

3rd Plaintiff

and

I & M Bank Limited

1st Defendant

Kentrack Auctoineers

2nd Defendant

Directions

1. On November 30, 2022, the court directed that the notice of motion application dated November 23, 2022 be heard interparties today, the December 8, 2022. Mr Wawire, counsel for the defendants has just submitted to court that the application was not served forthwith as directed on November 30, 2022 and the defendants had no enough time to file any response.

2. Mr. Wafula, counsel for the plaintiffs/applicants on the other hand, argued that they received the courts directions on December 1, 2022 and served the same upon the defendants on December 2, 2022. Given that the intended auction is scheduled for today, he asked the court to grant prayers No 2 and 3 to preserve the subject matter.

3. Mr. Wawire in his rejoinder opposed the grant of the said prayers on grounds that they ought to have been granted when the application was initially placed before the court. However, he suggested that were the court to grant the prayers, then the plaintiff should be directed to pay the auctioneer’s fees in the sum of Kshs 2,530,500/=. Mr Wafula on his part suggests that the issue of auctioneer’s fees can be determined later.

4. I have read through the application dated November 23, 2022 and prayers No (2) and (3) thereof seek for injunction restraining the respondents by themselves or their agents from selling by auction or completing any conveyance or in any other way whatsoever, interfering with LR XXXX2 and LR XXXX7 pending the determination of the application. The grounds adduced in support of the application are interalia that the applicants are the registered owners of the two parcels of land and the respondent has threatened to sell the same over a non-existence loan of Kshs 206,502,331. 51. The applicants avers that they have not been accorded a chance to exercise their right of redemption and are consequently likely to suffer irreparable loss should the auction be allowed to proceed.

5. In my understanding, and as this court and others within our jurisdiction have held that the omission to serve a valid statutory notice is an irregularity or impropriety to be remedied in damages. It is a fundamental breach of statute, which derogates the chargor’s equity of redemption. A temporary injunction is therefore issued to preserve the property in dispute and rights of the parties pending disposal of the suit or other controversial issues in the matter. I am therefore persuaded that the plaintiffs have established in the application dated November 23, 2022, prima facie rights which ought to be protected. However, where there are serious conflicts of facts as it is in this case, then the court should direct that status quo be maintained.

6. Having carefully considered the available evidence, the finding that this is a proper case to direct the maintenance of status quo pending determination of the controversial issue, consequently, the following orders do issue:-a.That status quo prevailing over the suit properties LR XXXX2 and LR XXXX7 pending the determination of the notice of motion application dated November 23, 2022. b.That the issue of whether the plaintiff should be ordered to pay auctioneers fees and the fee payable is to be determined at a later stage in the correct forum.c.That the defendants/respondents are granted fourteen (14) days to file a response to the notice of motion application dated November 23, 2022. d.Thereafter, the application to be canvassed by way of written submissions and parties are granted fifteen (15) days each to comply starting with the applicant.e.The matter to be mentioned on January 31, 2023 for highlighting and fixing a ruling date.It is so ordered.

RULING DELIVERED VIRTUALLY, DATED AND SIGNED AT NAIROBI THIS 8THDAY OF DECEMBER, 2022. D. O. CHEPKWONYJUDGEIn the presence of:Mr. Wafula counsel for Plaintiffs/ApplicantsMr. Wawire counsel for the Respondents/DefendantsCourt Assistant - Sakina