Catherine Muthoni Karugia v Kinyua Muriithi [2021] KEBPRT 299 (KLR)

REPUBLIC OF KENYA

BUSINESS PREMISES RENT TRIBUNAL

VIEW PARK TOWERS 7TH & 8TH FLOOR

TRIBUNAL CASE NO. 792  OF 2019  (NAIROBI)

(CONSOLIDATED WITH 511 OF 2019)

CATHERINE  MUTHONI KARUGIA.......APPLICANT/LANDLADY

VERSUS

KINYUA MURIITHI........................................ RESPONDENT/TENANT

JUDGMENT

1.   By a tenancy notice dated 21st September 2018, the tenant sought to obtain reassessment of rent or alteration of terms of tenancy by reduction of monthly rent from Kshs.27,000/- to Kshs.14,000/- with effect from 1st December 2018.

2.   The Landlady wrote a letter of objection dated 26th September 2018 intimating that she would not comply with the said notice.

3.   Thereafter the Landlady filed the instant reference against the said notice vide NRB BPRT No. 792 of 2018 naming the Tenant as the Respondent.

4.   On 29th March 2019, the Landlady served a notice of termination of tenancy upon the tenant on the grounds that she wished to use the shop for her own personal use with effect from 1st June 2019.

5.   The Tenant in opposition to the said notice filed NRB BPRT No. 511 of 2019 against the landlady.  The matters were ordered to proceed to hearing together.

6.   Several turns and twists took place in this matter before the main hearing which I do not propose to advert to as the same have previously been determined by this tribunal conclusively and no appeal was preferred in relation thereto.

7.   The relationship between the landlady and the tenant was reduced into writing vide a lease agreement dated 7th March 2016 for a period of 5 years and 2 months at a monthly rent of Kshs.27,000/- plus VAT where applicable at 16%.

8.   Rent was agreed to be payable one (1)  month in advance and was reviewable after each calendar year to the market rate or to such a  reasonable figure agreed between the two parties with all payments being made to Chabrin Agencies Limited.

9.   Clause 6 of the agreement stipulate that the tenancy can be terminated by either party giving three (3) calendar months notice in writing during the continuance of the tenancy.

10. The agreement is executed by both parties and duly witnessed by an independent witness.

11. The matter proceeded by way of viva voce evidence with the landlady calling one witness one Gibson Mwangi Gitau who is the Assistant property manager, Chabrin Agencies Ltd which manages the property.

12. According to the witness, the agreement period was from 1st March 2016 to 31st May 2021.  He produced the tenancy agreement as exhibit 1.

13. The witness testified that the tenant was not paying rent as per the agreement and by August 2020 he had a balance of Kshs.2000/- and between September 2020 and May 2021 he had a further rent balance of Kshs.245,000/- plus costs of Kshs.20,000/- awarded in BPRT NO. 994 of 2018.

14. Upon the tenant’s application for reassessment of rent, the landlady undertook valuation which was filed on 20th September 2019 recommending a monthly rent of Kshs.43,000/- exclusive of other charges.

15. The valuation report of the landlady was produced as exhibit 2.

16. The tenant also did a valuation by inter link Real Estates Ltd recommending a monthly rent of Kshs.17,360/-.  The same was produced as exhibit 3.

17. It was the witness’ testimony that the landlady wished to use the suit premises for her own purpose.  She had previously operated a hardware which was taken over by her son who now operates a play station.

18. The landlady wishes to continue operating the hardware in the suit premises.  Notice to terminate tenancy was served on 30th September 2018 and the same was produced as exhibit 4.

19. A second notice in the prescribed form was served on 29th March 2019 which is the subject matter of the instant reference.

20. In cross-examination, the witness confirmed that the Respondents’ attempt to distress for rent was stopped through a court order issued by Ruiru Law Courts.

21. The witness further confirmed that he was testifying as an agent of the landlady and that he was familiar with the dispute.

22. After close of the landlady’s case the tenant testified in minute details about all the stages this matter had undergone and I shall only pick what is relevant to the determination of the two notices subject matter of consolidated references.  This is because as I have pointed out earlier in this judgment, this Tribunal had pronounced itself on many of the issues raised by the tenant in his evidence.

23. The tenant testified that he operates a pharmacy in the landlady’s premises at a monthly rent of Kshs.27,000/- which he paid until May 2020.

24. Before May 2020, the tenant stated that he sought to actualize a clause in the lease agreement providing for review of rent to market rate (Clause 1) or to such a figure agreeable by both parties.

25. In the year 2017, he approached the landlady for a review of rent whereupon he was referred to the agent (Chabrin Agencies).

26. In July 2018, he again approached the landlady who ignored him as a result of which he approached the Tribunal in August 2018 for reassessment of rent.

27. He served the landlady and waited until the notice took effect on 1st December 2018 when the landlady replied that she would not comply and demanded that he vacates the premises.

28. The demand to vacate was not in the prescribed form and the tenant approached this Tribunal in BPRT No. 994/2018 wherein he was granted orders against eviction.

29. The tenant testified that he received a tenancy notice sometimes in March 2019 from the landlady stating that she wanted to use the premises for her own use.

30. He therefore filed BPRT No. 511 of 2019 in opposition thereto although the reason given was valid.

31. He however opposed the notice as he knew that it was intended to defeat proceedings in BPRT No. 792 of 2019.

32. According to the tenant, several shops had fallen vacant and the landlady had given them out to others and as he testified he alleged that there was a notice of vacant shop.

33. The tenant testified that his relationship with the landlady deteriorated after serving the notice for reassessment of rent.

34. He testified that he had no information that the Tribunal had vacated the order reducing rent from Kshs.27,000/- to Kshs.17,000/- on 25th May 2020 and that he had been paying the reduced rent from 1st December 2018.

35. During cross-examination, the tenant confirmed that the lease agreement had expired on 31/5/2021.

36. He confirmed further that the lease had not been renewed and that he had not applied for renewal.

37. Both parties did not submit on the matters in issue and sought to rely on the evidence on record.

38. I am now called upon to determine the following issues:-

(a) Whether the tenant is entitled to reassessment of rent.

(b) Whether the landlady is entitled to terminate tenancy.

(c) Who is liable to pay costs?

39. Section 4(3) of Cap. 301, laws of Kenya provides that:-

“A tenant who wishes to obtain a reassessment of the rent of a controlled tenancy or the alteration of any term or condition  in or of any right or service enjoyed by him under such a tenancy shall give notice in that behalf to the landlord in the prescribed form”.

40. The landlady issued a notice of objection in terms of Section 4(50 of the Act and thereafter filed a reference in terms of Section 6 of the Act.

41. In his evidence before this Tribunal, the tenant did not provide any reasons why he wanted the agreed rent to be reduced from Kshs.27,000/- to Kshs.14,000/-.  He did not allude to any coercion duress, undue influence or any other vitiating factor which could invalidate the lease agreement which set the monthly rent at Kshs.27,000/-.

42. The tenant only stated that he wanted to actualize clause 1 of the tenancy agreement which provided for review of rent to market rate or such figure agreeable by both parties.

43. The tenant’s valuation report produced by the landlady’s witness as exhibit 3 and prepared by inter-link Real Estates Ltd sets the rent for the suit premises  at Kshs.17,000/- while the one prepared by Tuliflocks limited on behalf of the Landlady and produced as exhibit 2 set the monthly rent at Kshs.43,000/-.

44. In absence of any justification for reassessment of rent on the part of the tenant and granted the wide disparity between the amount of rent recommended by the tenant’s valuer vis –a vis that recommended by the landlady’s valuer, I have no basis to interfere with the amount agreed  upon by both parties in the tenancy agreement executed on 7th March 2016.

45. This is moreso considering the fact that the rent has remained static for the last 5 years which does not make economic sense.  I will not make or rewrite the contract as my duty is to enforce what had been agreed upon by parties and not to make new contracts for them.

46. In this regard I wish to rely on the decision of the superior court in Dr. Koisagat Tea Estate Ltd – vs- Eritrea orthodox Tewhdo Church Ltd (2015) eKLR at page 8/13 in which the court cited the Court of Appeal holding in National Bank (k) Ltd – vs- Pipe Plastic Sarkolit (k) Ltd & another C.A 95/99 as follows:

“A court of law cannot rewrite a contract between the parties as the parties are bound by the terms of their contract unless coercion, fraud, or undue influence are pleaded”.

47. Similarly in the instant case, I decline to reduce or increase the rent from what was negotiated and agreed upon by both parties.

48. In regard to the notice of termination of tenancy issued by the  landlady, I find that Section 4(2) of Cap. 301 allows termination of a tenancy in the manner sought by the landlady.

49. Section 7(1) (g) of the said Act allows termination of a tenancy on grounds that “the landlord himself intends to occupy for a period of not less than one year the premises comprised in the tenancy for the purposes or partly for the purposes of a business to be carried on by him therein or as his residence”.

50. The landlady is said to intend to restart a hardware which she closed after her previous shop was taken over by her son who now runs “ a play station”shop therein.

51. The tenant confirmed in cross-examination that the reason given by the landlady for requiring possession was valid though he stated that other shops had fallen vacant and the landlady did not take any for her said purposes.

52. What the tenant failed to demonstrate is whether the said shops were of a similar size and suitability as the one in his occupation for purposes of running a hardware shop.

53. The tenant did not allege that the landlady had no intention to use the shop as a hardware.

54. I have no reason to doubt that the reason given by the landlady in seeking to terminate tenancy is genuine and valid.

55. This coupled with the fact that the tenancy agreement between the parties expired on 31/5/2021 tilts the case in favour of upholding the termination notice as this Tribunal cannot extend the agreement beyond the term agreed upon by the parties.

56. In this regard, I rely on the decision in the case of Kasturi Limited – vs- Nyeri Wholesalers Limited (2014) eKLR wherein the court of appeal at paragraph 15 cited with approval the dicta by lord Halisbury in Jacob – vs- Booths Distillery Co. 85 LTR at 262 where he stated that:-

“There are some things too plain for argument”.

The court went on to hold as follows:-

“It is the duty of the courts to ensure that no individual is prevented from taking possession and or enjoying their property.  A tenant cannot impose or force him/herself/itself on a landlord.  In the instant case when the lease between the parties expired, it was incumbent upon the appellant to give vacant possession.  The respondent legitimately exercised its right to seek summary judgment and an order for vacant possession and or forcible eviction of the appellant.  We have no doubt that in entering summary judgment against the appellant, the learned Judge acted properly and cannot be faulted.

57. Equally in the instant case the tenant ought to have given vacant possession of the premises immediately after 31st  May 2021 when his tenancy came to an end.

58. In the premises and in view of all the foregoing findings, I hereby make the following orders:-

(a) The tenant’s notice of reassessment of rent dated 21st September 2018 is hereby dismissed and the reference in NRB BPRT NO. 792 OF 2018 is upheld with costs.

b. The landlady’s notice of termination of tenancy dated 29th March 2019 is hereby upheld and the tenant’s reference in NRB BPRT NO. 511 of 2019 is dismissed with costs.

c. The tenant shall forthwith deliver vacant possession of the suit premises situated on L.R. NO. 12/149/18, Ahadi Arcade, Kahawa Wendani, Kiambu County and in default thereof, he shall be evicted by a licensed auctioneer with the assistance of the area OCS who shall provide security.

d. The tenant shall pay costs of both references assessed at Kshs.60,000/- together with any execution expenses incurred during eviction.

e.  The tenant shall clear all the outstanding rent arrears based on the agreed rent of Kshs.27,000/- and in default the landlady shall be entitled to levy distress against him.

It is so ordered.

DATED, SIGNED & DELIVERED THIS 10TH DAY OF SEPTEMBER 2021.

HON. GAKUHI CHEGE

VICE CHAIR

In the presence of:

Tenant

No appearance for the Respondent/Landlord