Greenfield Petroleum Limited & another v DIB Bank Kenya & another [2023] KECA 1529 (KLR)

Greenfield Petroleum Limited & another v DIB Bank Kenya & another (Civil Appeal (Application) E099 of 2023) [2023] KECA 1529 (KLR) (8 December 2023) (Ruling)

Neutral citation: [2023] KECA 1529 (KLR)

Republic of Kenya

In the Court of Appeal at Mombasa

Civil Appeal (Application) E099 of 2023

SG Kairu, P Nyamweya & GV Odunga, JJA

December 8, 2023

Between

Greenfield Petroleum Limited

1st Applicant

Kipyegon Stanley Cheruiyot

2nd Applicant

and

Dib Bank Kenya

1st Respondent

Muga Auctioneers & General Merchants

2nd Respondent

(An application for conservatory orders restraining the respondents from advertising, offering for sale, alienating, transferring, disposing, auctioning, or in any manner dealing with the charged properties pending the hearing and determination of their appeal against the ruling of the High Court of Kenya at Mombasa (Wangari, J.) delivered on 25th May 2023 in High Court Civil Suit No. E061 of 2022 Civil Suit E061 of 2022 )

Ruling

1. In a ruling delivered on 25th May 2023, the High Court at Mombasa (F. Wangari, J.) dismissed the applicants’ application for an interlocutory order of injunction to restrain the respondents from selling properties known as L.R. No. MN/I/15338 (Original No. MN/I/15266/73) and Mombasa/Block 1/431 (the charged properties) in exercise of chargee statutory power of sale.

2. In dismissing that application, the learned Judge expressed that there was no doubt that the charged properties were charged to the 1st respondent to secure banking facilities extended to the applicants; that there was default in repayment of the facilities that precipitated the issuance of statutory notices that were served on the applicants; and that the fact that a charged property may be a matrimonial home does not shield it from exercise of statutory power of sale. In the end, in addition to finding that the applicants were undeserving of an equitable relief on account of being “less than candid” and “guilty of material non-disclosure”, the learned Judge concluded that the applicants had not established a prima facie case within the principles in Giella vs. Cassman Brown & Co Ltd [1973] EA 358.

3. The applicants are now before us with a motion dated 25th June 2023, and made under Rule 5(2)(b) of the Court of Appeal Rules, among other provisions, seeking conservatory orders restraining the respondents from advertising, offering for sale, alienating, transferring, disposing, auctioning, or in any manner dealing with the charged properties pending the hearing and determination of their appeal.

4. Appearing before us during the hearing of the motion on 10th August 2023, learned counsel for the applicants Mr. Nabende holding brief for Mr. Wameyo referred to the grounds in support of the motion, the affidavit in support sworn by the 2nd applicant, and his written submissions in urging that the applicants have an arguable appeal; that the Judge erred in failing to find that any sale of the charged properties by the respondent would, contrary to Section 97 of the Land Act, be at a value below the current market value, and that in the event the orders sought are not granted, the charged properties will have been disposed by the time the appeal is heard and the respondents will “have stolen a match” and the appellants will have suffered irreparable loss and damage. Although counsel referred to a notice of appeal having been filed, it was not attached to the application or exhibited to the supporting affidavit.

5. Counsel for the respondents Ms. Z. Abdi in opposing the application submitted that there is no notice of appeal served; that all the pre-requisites to the exercise of statutory power of sale were fulfilled by the 1st respondent; that the intended appeal is not in any event arguable; that there is spousal consent to the charge; that there is a valuation report; that in any case the appeal will not be rendered nugatory as the applicants would have a remedy in damages in the event of establishing a claim against the respondents.

6. The parameters within which this Court considers applications of this nature are settled. See Trust Bank Limited and another vs. Investech Bank Limited and 3 others [2000] eKLR; NIC Bank Limited & 2 others vs. Mombasa Water Products Limited [2021] eKLR; and Stanley Kangethe Kinyanjui vs Tony Ketter & 5 Others, C.Applic. No. 31 of 2021[ 2013] eKLR.

7. There is no notice of appeal that is shown to have been filed and counsel for the respondents maintain that none has been served. Without a notice of appeal, the Court has no jurisdiction. See Attorney General vs. Kazungu, C.A.(Applic) No. E078 of 2022 [2023] KECA 498(KLR); Kandie vs. Lekakeny, Civil Applic. No. E094 of 2021 [2022] KECA 447(KLR).

8. On merits of the application, has the applicants demonstrated that the intended appeal is arguable? We bear in mind that an arguable appeal is not one that must necessarily succeed. That said, the impugned ruling is one that involved the exercise of judicial discretion by the learned Judge in declining to grant an interlocutory injunction. It is not manifest from the grounds enumerated in the draft memorandum of appeal that there is complaint that the Judge considered matters she should not have, or failed to consider matters she should have, or that the decision is plainly wrong. We entertain doubts that the intended appeal is arguable.

9. On the nugatory aspect, considering that there is no contest that the charged properties are indeed charged to the Bank to secure facilities, the applicants have not shown why damages would not be an adequate remedy in the event the exercise of the power of sale is ultimately found to be irregular.

10. The application fails and is dismissed with costs to the respondents.

DATED AND DELIVERED AT MOMBASA THIS 8TH DAY OF DECEMBER 2023. S. GATEMBU KAIRU, FCIArb…………………………JUDGE OF APPEALP. NYAMWEYA…………………………JUDGE OF APPEALG.V. ODUNGA…………………………JUDGE OF APPEALI certify that this is a true copy of the original.SignedDEPUTY REGISTRAR