Benjamin Ndula,Josephine Wayua Mwinzi,Patrick Mulwa,Fidelis Musembi & Elizabeth Ndunge Kilambya v Caroline Ngina Mwongela,Seth Wanzau & Rafiki Microfinance Bank Limited [2018] KEELC 3861 (KLR)

REPUBLIC OF KENYA

IN THE ENVIRONMENT  AND LAND  COURT AT MAKUENI

ELC  CASE NO. 331 OF 2017

BENJAMIN NDULA....................................................1ST PLAINTIFF

JOSEPHINE  WAYUA MWINZI...............................2ND PLAINTIFF

PATRICK MULWA......................................................3RD PLAINTIFF

FIDELIS MUSEMBI....................................................4TH PLAINTIFF

ELIZABETH  NDUNGE KILAMBYA.......................5TH PLAINTIFF

VERSUS

CAROLINE   NGINA  MWONGELA.....................1ST DEFENDANT

SETH  WANZAU.......................................................2ND DEFENDANT

RAFIKI MICROFINANCE  BANK LIMITED....3RD  DEFENDANT

RULING

1)  There is before  me a notice  of motion application  expressed  to be brought under sections 1A, 1B, 3A and   63 of the Civil Procedure Act, Order 40 Rule 1 and  Order  51 rule  1 of the Civil Procedure  Rules and all enabling  provisions of the law for orders that;

1.  Spent

2.  Spent

3.  That   this   Honourable court be pleased to grant an order of temporary injunction restraining the 3rd defendant, its agents, servants or anyone acting through it from repossessing, selling, advertising for sale and or in any other manner interfering  with the suit properties herein   being MAKUENI/UNOA/2790, 2798, 2808 & 2811  pending  the hearing and determination of the suit herein.

4.  That  the defendants/respondents bear the costs of the application herein.

The application is dated  30th August , 2017 was filed in court on the 31st August, 2017.  It is predicated on the  grounds on its face and is supported by the affidavit of Benjamin Ndula Ndaka, the first applicant, sworn on behalf of his co-applicants at Machakos on the 30th August,2017.

2)  The application is opposed by the third respondent vide its grounds of opposition  dated  15th  September, 2017 and filed in court on the 18th September, 2017.  The first and the second respondent are not opposed to the application.

3)  On the 18th September, 2017, the court directed that the application be disposed off by way of written submissions.  The applicants and the third respondent filed their submissions on the 9th November, 2017 and 7th December, 2017 respectively.

4)  Both the applicants counsel and the third  respondent’s counsel are agreed that the grant or otherwise of temporary injunction in this motion is pegged on the principles set out in the famous case of Giella Vs Cassman Brown Ltd [1973]EA 358. These  principles are :-

I.  The applicant must show a prima facie case with probability of success.

II. That  on interlocutory injunction will not  normally be granted unless the applicant would suffer irreparable injury  which cannot be compensated in damages.

III. That if the court is in doubt, it will decide the application on the balance of convenience.

5)  Regarding the principle  of prima facie case, the applicants’ counsel submitted that the  applicants have demonstrated beneficial ownership  of the suits properties herein by way of sale agreements.  The counsel pointed out that the first and the second respondents have not denied the said sale.  The counsel went  on to submit that the applicants have equally  demonstrated their actual occupation and use  of the suit properties which the respondents do not deny.  It was also the applicants’ counsel’s submissions that the applicants have imputed fraud and illegality in the transfer and registration of the title to the suit properties in favour of the first respondent, an issue the first and the second respondents do not deny.  The counsel added that the applicants contend that the charge created over the suit properties was illegal and fraudulent which issue the  respondents have not denied. The counsel  pointed out that the third respondent has confirmed  the applicants’ apprehension that it is  keen on selling the suit properties and hence the need  for the  grant of  the orders sought. On the other hand, the third   respondent’s counsel submitted that it is not disputed that the first respondent  charged the property to the third defendant to secure  the sum of Kshs. 10,000,000  and consequent to which she executed a charge over the suit property in favour of the 3rd respondent. The  counsel further submitted that contrary to the applicants claim that they are beneficial owners of the suit property by way of sale  agreements, the  1st  respondent is the registered owner of the same and  hence has proprietary interest on the  said suit property. The counsel  pointed  out  that the applicants have not demonstrated that they have a prima facie case with probability of success to warrant an injunction order.

6)  The applicants have  in paragraph 3 of their  supporting affidavit acknowledged that the land is registered in the name  of the 2nd  respondent.  They have deposed in paragraphs 5 and 6 of their supporting affidavit how they  purchased their  respective parcels of land from sellers who had purchased those parcels of land presumably  from the 2nd respondent. Of importance to note is that neither the applicants herein nor the sellers from whom they purchased the land from had   ownership of their respective parcels of land transferred in their names. The applicants did not offer any explanation for their failure to affect transfer of ownership of the suit property.  In addition, I presume that the suit property is agricultural land and as such the grant of consent made in the  prescribed form to the appropriate land control board within 6 months within the making of the agreement was necessary as required under section 8(1) of the Land  Control Board chapter 302 of the laws of Kenya. There is no evidence of such application having ever been made by the applicants herein. I, therefore, agree with the 3rd respondent’s counsel that under the provisions  of section 26 of the Land Registration Act, the certificate of title herein is deemed as prima facie  evidence that the  person  named as the proprietor of the land is the absolute and indefeasible owner subject to the encumbrances, easements, restrictions and conditions contained or endorsed in the certificate … Even though their no evidence of the 1st respondent having  charged  the property to secure a loan facility of  Kshs. 10,000,000 as was submitted by the  3rd respondents counsel, it is clear that the  suit land was to be sold for failure  of the 1st and 2nd respondent’s to  pay  to the   3rd  respondent  Kshs. 293,734/58 upon  issuance of  statutory notices of sale by the latter. As such it is clear that   the applicants have not demonstrated  that  they have a prima facie case without probability of success.

7)  On the issue of irreparable injury which cannot be compensated in damages, the applicants counsel submitted that the applicants have demonstrated in the photos annexed to their supporting affidavit the developments that they  have carried  out  on the suit  property whose  sale would occasion huge and irreparable  loss which cannot be compensated by damages. On the   other hand, the counsel for the 3rd respondents submitted that it is the 3rd respondent that is likely to suffer irreparable loss and damage if the application is allowed in that the loan amount  which is yet to be  serviced  by the 1st  respondent will continue  to accrue  interest thereby diminishing the value of the security held by it.  The counsel pointed out that if the applicants succeed  at the trial,  the 3rd respondent is in a position to pay  damages  which in the circumstances would  be adequate  remedy.  Further the counsel submitted that the charge that was duly executed by the 1st respondent to guarantee repayment of the loan facility to the 3rd respondent and upon failure by the  former to liquidate  the same,  the 3rd respondent’s  statutory power of sale crystallized.

8)  Arising from the  above, my finding is that the  value  of  the developments  that the applicants have invested on the suit property is quantifiable and can be compensated in damages. The applicants have not shown that their  investments are of sentimental value which cannot be quantified.  I agree with the  3rd respondent that if anything, it is the latter that is likely to suffer irreparable  injury if the application is allowed.

9)On the balance of convenience, the applicant’s  counsel submitted that the  applicants have proved that the suit property is in  danger of being alienated by the  3rd respondent and would effectively delay  and/or obstruct the applicants in having their properties back from the would be purchasers should the court eventually find in their  favour.  On his part, the counsel for the  3rd respondent submitted that since there is no dispute  that the 1st respondent is the registered owner of the suit property and she is in default of loan repayment of Kshs. 293,734/58 as at  10th July, 2017 arising  from the charge over the suit properties in favour of the 3rd respondent, the balance of convenience tilts in favour of the 3rd respondent. The counsel relies on the case of Maithya  V Housing  Finance Co . of Kenya and Another [2003] EA133at  139.

10) I wish  to state  that this court is not in doubt and even if it were, the balance of convenience would  clearly tilt and it tilts  under the circumstances, in favour of the 3rd respondent. There is no denial of the fact that the 1st respondent secured a loan facility and she is in default of the  loan repayment   in the  sum of Kshs. 293,734/58 as at 10th July, 2017 as was submitted by the counsel for the  3rd respondent.  Even if the applicants were to succeed at the substantive hearing of the suit herein  and thereafter they are unable to recover their  properties from the  new owners, the value of their properties is quantifiable and can be compensated in damages as I have stated principle  herein above in  principle  number two.

11) Arising from the above, it is my finding that the application by the applicants lacks merits and same is dismissed with costs to the 3rd respondent.

Signed, dated, and delivered at Makueni this 1st day of March, 2018

MBOGO C.G

JUDGE

In the presence of;

Ms Kyalo for the applicants

Mr. Muthiani holding brief for  Mr.  Onyancha for the  1st and 2nd respondents

S.I Mwaura & Co.  Advocate for the 3rd respondent

3rd respondent present through its Wote Branch Manager

Mr. Kwemboi Court Assistant

MBOGO C.G

JUDGE

1/3/2018