Benson Kirema Kiruki Marete & Beatrice Thaimuta Selasio v Union Place Management Limited [2021] KEBPRT 104 (KLR)

Full Case Text

REPUBLIC OF KENYA

BUSINESS PREMISES RENT TRIBUNAL

VIEW PARK TOWERS 7TH & 8TH FLOOR

TRIBUNAL CASE NO. 21 OF 2021 (MERU)

BENSON KIREMA KIRUKI MARETE...............................TENANT/1ST APPLICANT

BEATRICE THAIMUTA SELASIO.....................................TENANT/2ND APPLICANT

VERSUS

UNION PLACE MANAGEMENT LIMITED..................LANDLORD/RESPONDENT

RULING

1. Before me are two applications by the tenants and Landlord dated 9th August 2021 and 18th August 2021 respectively.

2. By their application dated 9th August 2021, the tenants are seeking for a restraining order against the Landlord from stopping access to the tenants from use and access of the business premises pending the hearing and determination of the suit.

3. The tenants are further seeking for a restraining order against the landlord from holding or auctioning their property pending the hearing and determination of the suit.

4. Prayers 2 and 5 were granted at the ex-parte stage and are therefore spent.

5. The application is supported by the affidavit of 1st tenant sworn on 9th August 2021 and the grounds on the face of the application.

6. It is the tenants’ case that they have been tenants at Union Square since 2016 carrying on the business of a Spa and barber shop at an agreed monthly rent of Kshs.120,000/-.

7. Owing to the hard economic times and effects of Covid-19 pandemic, the tenants fell into rent arrears prompting them to request for a rent review downwards which was denied.

8. A verbal agreement was entered into with the landlord on a framework to clear the arrears with weekly payments of Kshs.30,000/- which the tenant claims to have honoured without annexing any evidence to that effect.

9. The landlord however demanded for immediate payment of Kshs.106,000/- on or before the 5th August 2021 in utter ignorance of the payment arrangement.

10. On 5th August 2021, the 2nd tenant found the business premises being manned by security guards under the landlord’s instructions thereby denying access to the tenants and their staff.

11. This affected the tenants’ business and frustrated efforts to clear the arrears as agreed. As all efforts to plead with the landlord became fruitless, the tenants filed the instant proceedings.

12. It is the tenants’ case that the business was servicing a loan with Cooperative Bank and risked being auctioned to recover the same.

13. The spa has more than 12 employees who by the closure risked loss of a source of income.

14. The Landlord is accused of denying the tenants inter-alia from putting up signage and markings to mark their shops for proper identification which had led to loss of business.

15. The application is opposed through the replying affidavit of Polly Kaari Njeru a director of the landlord sworn on 18th August 2021 in which it is denied that the tenants requested for review of rent downwards which was rejected by the landlord.

16. The landlord has annexed commitment letter marked ‘PKN3’ to show that the tenants had agreed to pay Kshs.30,000/- on weekly basis in a move to assist them in offsetting the huge rent arrears owed to the landlord.

17. It is deposed that the tenants failed to honour the arrangement and by July 2021 they owed Kshs. 840,200/- which led to closure of the business and denial of access thereto.

18. It is however denied that the landlord intended to illegally auction the tenants’ property as alleged by them. All avenues to accommodate the tenants have been unfruitful.

19. The landlord deposes that the tenants sole intention was to remove work related equipment and appliances and thereafter vacate the premises in order to deny it financial and proprietary right to rent.

20. By the time of swearing the affidavit the amount owed as rent was Kshs.890. 200/- as per the rent account statement marked ‘PKN5’.

21. The landlord deposes that the proceedings are defective for lack of a plaint and supporting documents and that this Tribunal should not aid a wrong doer as the tenants have not been paying rent.

22. It is the landlord’s case that it is unjust and unfair for the tenants to benefit from their own wrong doing to the detriment of the landlord.

23. The landlord deposes that the tenants have approached the Tribunal with unclean hands and were using the Tribunal to frustrate its right to property and protection of economic interests enshrined in the Constitution.

24. On 18th August 2021, the landlord moved this Tribunal seeking in pertinent part for an order compelling the tenants/respondents to pay Kshs.890,200/- in rent arrears as at that date.

25. It further seeks for an order of eviction of the tenants and repossession of assets held in the premises in settlement of rent owing to the landlord.

26. The landlord is also seeking to be allowed to retain all the business equipment and appliances in the business premises of the tenants until all the arrears are paid.

27. The application is supported by the affidavit of Polly Kaari Njeru sworn on 18th August 2021 wherein the landlord demonstrates how the amount claimed is made up and the various commitments made by the tenants to pay in vain.

28. I have not seen any response by the tenants to the said application and the same is therefore unopposed.

29. The applications were argued orally on 21st October 2021 by both counsels.

30. The issues for determination therefore are:-

(a) Whether the tenants are entitled to the prayers sought in the application dated 9th August 2021.

(b) Whether the landlord is entitled to the orders sought in the application dated 18th August 2021.

31. The principles upon which an application for interlocutory temporary injunction is considered are long settled by the celebrated case of Giella – vs- Cassman Brown & Co. Ltd(1973) EA 358 to wit:-

(i) An Applicant must show a prima facie case with a probability of success.

(ii) An injunction will not normally be granted unless the applicant might otherwise suffer irreparable injury.

(iii) When the court is in doubt, it will decide the application on the balance of convenience.

32. In the case of Samuel Kipkori Ngeno & Another – vs- Local Authorities Pension Trust (Registered Trustees) & Another (2013) eKLR, the High Court faced with an application for injunction by a tenant who had failed to pay rent had the following to say at paragraphs 9 and 12:-

“9. A tenant’s first and main obligation is to pay rent as and when the same becomes due for the landlord has the right to an income from his investment…”

“12. The temporary injunction sought in the present application is an equitable remedy at the court’s discretion. He who comes to equity must come with clean hands. A tenant who is in huge arrears of rent is underserving of the court’s discretion. The court cannot be the refuge of a tenant who fails to meet his principal obligation of paying rent as and when it becomes due”.

33. In the present case, it is not disputed that the tenants are in huge rent arrears. All commitments and undertakings to settle the same have borne no fruits. By the time the application was argued before me, the tenants were arrears of Kshs.1,130,200/-. Can this Tribunal grant an injunction against the landlord?

34. The answer to the foregoing question is a big NO. I have no doubt in my mind that the tenants having committed to pay outstanding rent arrears in writing in terms of documents exhibited by the landlord acted with unclean hands by seeking an injunction against the landlord. They are therefore disentitled to continue being protected by this Tribunal from meeting their cardinal obligation to pay rent.

35. In the premises, I find and hold that the application dated 9th August 2021 is without any merit and is a candidate for dismissal.

36. Conversely, the landlord has demonstrated that the tenant owed it rent in the sum of Kshs.1,130,200/- as at 21st October 2021. Its application dated 18th August 2021 is not opposed and it is therefore for allowing.

37. In the premises, the following final orders commend to me in this matter:-

(a) The tenants application dated 9th August 2021 is hereby dismissed with costs.

(b) The landlord’s application dated 18th August 2021 is granted in terms of prayers 2, 4 and 6 with the rent in arrears being adjusted to the current month.

(d) Costs of Kshs.30,000/- is awarded to the landlord.

(e) Tenants’ reference is hereby deemed as compromised by this ruling.

It is so ordered.

DATED, SIGNED AND DELIVERED VIRTUALLY THIS 19TH DAY OF NOVEMBER 2021.

HON. GAKUHI CHEGE

VICE CHAIR

BUSINESS PREMISES RENT TRIBUNAL

In the presence of:

Kmunto for Landlord/Respondent

MS Wambulwa for the Tenants/Applicants