Jane Odhiambo v Kobelo Development Company Ltd & Beatrice Keya Kawanda [2021] KEBPRT 472 (KLR)

REPUBLIC OF KENYA

IN THE BUSINESS PREMISES RENT TRIBUNAL

TRIBUNAL CASE NO. 750 OF 2019 (NAIROBI)

JANE ODHIAMBO..................................................................... APPLICANT/TENANT

VERSUS

KOBELO DEVELOPMENT COMPANY LTD.........1ST RESPONDENT/LANDLORD

BEATRICE KEYA KAWANDA..........................................................2ND RESPONDENT

RULING

BACKGROUND

1. The Applicant/Tenant approached this Tribunal by way of a Notice of Motion dated 18th January, 2021seeking interim orders barring the Landlord/Respondents from evicting the Applicant/Tenant from Shop Number 4 on L.R. No. 37/240/4Nairobi West (herein “the suit premises”). The Applicant/Tenant has also sought permanent injunction restraining the Respondents from interfering with her quiet occupation and use of the suit premises. The premise of the application is that the Applicant/Tenant is in occupation of the premises by virtue of a valid Lease of over 15 years and that the 2nd Respondent issued an allegedly irregular notice with an intention to evict her. The Applicant/Tenant also claims that she has no rent arrears and that she is apprehensive that she may be unprocedurally evicted from the suit premises.

2. The 1st Respondent responded to the Motion through a Replying Affidavit sworn on 25th January, 2021by one of its Directors one Mr. Micah Ameyo opposed the motion. In summary, Mr. Ameyo’s depositions were that the Applicant/Tenant was in occupation of the suit premises under a disputed 5-year Lease. The Applicant/Tenant had breached the term of the tenancy by sub-letting the premises without the Respondents’ consent. It was also stated that a one-month notice was issued to terminate the 5-year Lease stating that the suit property was intended for other use other than letting to tenants. There was also an order issued by the Tribunal that the Tenant/Applicant’s Advocate cease acting in the matter as he was also a witness.

3. The 2nd Respondent filed a Replying Affidavit sworn by Beatrice Keya Kwanda the Finance Director of the 1st Respondent. Ms. Keya’s depositions were that the Tenant/Applicant first moved to the Tribunal on 7th August, 2019 seeking orders to break into the suit premises which were granted and thereafter set aside. That the 5-year term of the Lease was disputed by the 1st Respondent as it only issued 2-year Leases. The Tenant/Applicant breached the implied term of the Tenancy Agreement when she sub-let the suit premises. The Landlord took notice of the situation when the ladies who had sub-let the premises contacted them. That the Tenant/Applicant misled the Tribunal through her Replying Affidavit dated 18th October, 2019 that the two ladies were her business partners. Upon expiry of the alleged 5-year Lease, the Tenant/Applicant was issued with a one-month notice to vacate and the notice disclosed the intention to utilize the suit premises for other purposes. The Company has not collected any rent from the Tenant/Applicant since the notice was issued.

The application was canvassed by way of written submissions filed by the respective counsel for the parties and the same are summarized as follows:

TENANT’S/APPLICANT’S SUBMISSIONS

4. Counsel for the Tenant/Applicant filed written submissions dated 16th February 2021. It was submitted that the Replying Affidavits filed by the Respondents are not admissible owing to the fact that the Replying Affidavit sworn by the 1st Respondent was sworn by an unauthorized person whereas the one sworn by the 2nd Respondent was undated and thus inadmissible. It was contended that the notice issued by the Respondent was not proper as it failed to give the applicant two months’ notice. Reliance was placed on the decisions in:(i) Fredrick Mutua Mulinge t/a Kitui Uniform vs Teachers Housing Cooperative Society Limited (2017) eKLR; (ii) Manaver N. Alibhai t/a Diani Botique vs South Coast Fitness & Sports Centre Limited Civil Appeal No. 203 of 1994; (iii). Lall vs Jeypee Investments Ltd Nairobi HCCA No. 120 of 1971 (1972) EA 512 and(iv) Narshidas & Company Limited vs Nyali Air Conditioning and Refrigeration Services Limited Civil Appeal No. 205 of 1995. It was further submitted that the Tenant/Applicant’s application was merited as it established a reasonable cause of action and has a high chance of success on the basis that the Respondents failed to procedurally terminate the Tenancy as required by law. Reliance was placed on the cases of: (i) Drummond Jackson vs British Medical Association (1970) 2 WLR 688;(ii) DT Dobie & Company (Kenya) Ltd vs Muchina (1982); and (iii) Mrao Ltd vs First American Bank of Kenya and 2 others (2003) KLR 125.

LANDLORD’S SUBMISSIONS

5. The 1st and 2nd Respondent filed written submissions on 17th March, 2021. Counsel for the Respondents submitted that the Tribunal has no jurisdiction to determine the application as prayers 3 and 4 of the Application are injunctive in nature and therefore the tribunal has no jurisdiction to make such orders. They placed reliance on the following cases: (i)Patrick B. Makari vs Mrs. Doris Oluoch Abiero (2004) eKLRand (ii) Mombasa Gas Supplies Ltd vs The Registered Trustees National Union of Kenya Muslim Civil Appeal No. 258 of 2003. They argued that the Applicant was not a Tenant at the time of filing of the application and that the alleged 5-year Lease had expired and a notice of termination had been issued and the 1st Respondent had not collected rent since then. It was further argued that the act of the Tenant/Applicant sub-letting the suit premises necessitated the termination of the tenancy and reliance was placed on the case of New Calabash Limited vs Joseph Odero (2018) eKLR.The validity of the application was challenged and it was submitted that orders were issued by the Tribunal on 4th October, 2019 directing that the Tenant/Applicant’s Advocate seize to act on her behalf as he was also a witness in the suit therefore occasioning a conflict of interest.

6. It was further submitted that the Tenant/Applicant obtained orders from the Tribunal on 16th January, 2020 to access the suit property but the said orders were later set aside and as such she cannot continue to occupy the suit premises without any directive from the Tribunal. With regard to the Replying Affidavits, it was submitted that Mr. Mica Ameyo is an officer duly authorized to swear an Affidavit on behalf of the 1st Respondent and that Ms. Beatrice Keya Kwanda had a Grant of Letters of Administration to engage in matters concerning her late husband’s interests and that the Affidavit was duly signed.

ISSUES, ANALYSIS AND DETERMINATION

7. Having considered the parties’ pleadings, affidavits and submissions and having considered the relevant legal framework and jurisprudence, I find that the following are the main issues that are falling for determination before this Tribunal:

i. Whether there is a controlled tenancy;

ii. Whether there was a proper notice of termination issued; and

iii. Whether the Tribunal has the jurisdiction to grant the orders sought by the Tenant/Applicant?

8. I am also cognizant of other preliminary issues that have been raised by the parties which I now seek to address on the onset as follows:

i. Whether the Replying Affidavits are admissible

The Tenant/Applicant contended that the 1st Respondent’s Replying Affidavit is not admissible for the reason that the deponent Micah Ameyo has not been authorized to act on behalf of the 1st Respondent. I find that the Deponent stated in the Affidavit that he is a Director of the 1st Respondent and evidence has been tendered before this Tribunal to prove the same. Furthermore, as regards litigation by an incorporated company, the directors are as a rule, the persons who have the authority to act on behalf of the company.

The Tenant/Applicant also contended that the 2nd Respondent’s Replying Affidavit is inadmissible as it is undated. The Replying Affidavit before this Tribunal is indeed undated. However, the same is sworn and signed by the Deponent and it has been commissioned therefore, I find that pursuant to Article 159 (2)(d) of the Constitution of Kenya 2010,the same should not be vitiated due to the error of omission.

ii. Whether the application is valid

The Respondent contended that the Tenant/Applicant has no standing to file the application for the reason that they had been summoned as a witness before the Tribunal. There were Orders issued by the Tribunal on 4th October, 2019 and 20th February, 2020 directing that the Tenant’s/Applicant’s Advocate appears before the Tribunal as a witness and further that they cease acting as their legal representative when they appear as a Witness in the matter. However, the said Advocate has to date not tendered any notice of cessation to act however having not appeared as a Witness before the Tribunal.  Mistake of counsel ought not be vested on the client.  I will proceed and deal with the matters on merits.

Having dealt with the preliminary issues above, I therefore move on to the main issues which I hereby address as follows:

9. On the first main issue, pursuant to Section 2(1) of the Landlord and Tenant (Shops, Hotels and Catering Establishment) Act a controlled tenancy is defined as a tenancy of a shop, hotel or catering establishment which has been reduced into writing and which is for a period not exceeding five years. In the present case, the parties both presented before the Tribunal an Agreement dated 1st January, 2016 and in the said Agreement it has been stipulated that:

“The Landlord shall grant and the Tenant shall accept a lease of all that shop no. 4 erected on plot no. L.R. 37240/4, Nairobi West …for a term of five (5) years renewable and negotiable every 5 years...”

10. From the foregoing it is evident that the tenancy is a controlled tenancy. Indeed, I am aware that the 1st and 2nd Respondent contend that the Tenant/Applicant should not be deemed as a Tenant for the reasons that: (i). There was no existing Lease at the time of the filing of the application dated 18th January, 2021; (ii). The Landlord has not received any rent from the Tenant/Applicant since December, 2020. I wish to state that the Tenant/Applicant’s application relates to the intended eviction by the Landlord an act which I believe arose when the Tenancy was still in effect and therefore the Tribunal can entertain the present application nonetheless.

11. On the second issue, after establishing that there is a controlled tenancy, it is expected that the Landlord/Respondent would comply with the prerequisites set out in sections 4(1), (2), (4) & (5) of the Landlord and Tenant (Shops, Hotels and Catering Establishment) Act.These provide that:

4. “Termination of and alteration of terms and conditions in controlled tenancy

1) Notwithstanding, the provisions of any other written law or anything contained in the terms and conditions of a controlled tenancy, no such tenancy shall terminate or be terminated, and no term or conditions or right or service enjoyed by the tenant of any such tenancy shall be altered, other than in accordance with the following provisions of this Act.

2) A landlord who wishes to terminate a controlled tenancy, or to alter, to the detriment of the tenant, any term or condition in, or right or service enjoyed by the tenant under, such a tenancy, shall give notice in that behalf to the tenant on the prescribed form……

4) No tenancy notice shall take effect until such date, not being less than two months after the receipt thereof by the receiving party as shall be specified therein. Provided that—

i. where notice is given of the termination of a controlled tenancy, the date of termination shall not be earlier than the earliest date on which, but for the provisions of this Act, the tenancy would have, or could have been, terminated……

5) A tenancy notice shall not be effective for any of the purposes of this Act unless it specifies the grounds upon which the requesting party seeks the termination, alteration or reassessment concerned and requires the receiving party to notify the requesting party in writing, within one month after the date of receipt of the notice; whether or not he agrees to comply with the notice.”

12. From the assessment of the pleadings and the submissions by the parties, it is not disputed that the Landlord/Respondent issued a notice to vacate dated 22nd December, 2020 whose contents read in part as follows:

RE: NOTICE TO VACATE (Shop No.4)

“Pursuant to the provisions of the Landlord and Tenant Act, Cap. 301 Laws of Kenya, we wish to issue notice to vacate in respect to shop Number 4 on L.R. No. 37/240/4 located in Nairobi West.

As you are aware the proceedings of in BPRT Case No. 750 of 2019 which were premised on your alleged tenancy agreement which has been overtaken by events as such lease terminated on 21/12/2020.

The management…. has resolved to utilize the shop premises…otherwise than renting it out.

KINDLY TAKE NOTICEthat your last day in occupancy shall be on or before 20th day of January 2021 after which the management shall take immediate action.”

13. It is evident that the Landlord and Tenant (Shops, Hotels & Catering Establishment) Act Cap 301 Laws of Kenya lays down clearly and in detail, the procedure for the termination of a controlled tenancy. Section 4(1)of the Act provides that a controlled tenancy shall not terminate or be terminated otherwise than in accordance with specified provisions of the Act. This includes: (i). giving a notice in the prescribed form; (ii). The notice shall not take effect earlier that two (2) months from the date of receipt by the Tenant and (iii). The notice must specify the grounds upon which the termination is sought.  The Notice should also be in the prescribed form that is Form A where the Landlord should ask the Tenant in writing whether or not they will comply with the notice.

14. The court in the case of Lall vs. Jeypee Investments Ltd Nairobi HCCA No. 120 of 1971 [1972] EA 512 observed that there is a need for strict compliance with the law in issuance of notices and stated that:

“The Landlord and Tenant (Shops, Hotels and Catering Establishments) Act is an especially enacted piece of legislation which creates a privileged class of tenants for the purpose of affording them the protection specified by its provisions against ravages of predatory landlords. Such protection can only be fully enjoyed if the provisions of Act are observed to the letter otherwise the clearly indicated intention of the legislature would be defeated. In order to be effective in this fashion the Act must be construed strictly no matter how harsh the result...”

15. In the present case, the Notice issued to the Tenant/Applicant the Landlord indicated that the Tenancy Agreement had since terminated and further stated that the reason for the termination of the tenancy is that they intended to use the premises for other purposes other than letting out. In their submissions, the Landlord/Respondent submitted that the Tenant/Applicant had breached the Tenancy Agreement when she sub-let the premises to two other Tenants without the consent of the Landlord or any of its Directors. They relied on the case of New Calabash Limited v Joseph Odero (2018) Eklrwhere the Court upheld the decision of the Tribunal allowing the Landlord to terminate the tenancy on the basis that the Tenant had breached the terms of the controlled tenancy by sub-letting the premises without the consent of the Landlord.

16. However, the said notice failed to meet the requirements of section 4 of the Act as it was not in the prescribed format and failed to adhere to the timelines stipulated in the Act whereby the Tenant/Applicant was only given a one-month notice. In addition to this, the Tenant/Applicant was not afforded the opportunity to respond to the notice. Therefore, I find that the Tenant/Applicant never ceased to be a tenant of the Landlord/Respondent because the requirements of Section 4(2) of the Act have not been met.

17. The Landlord/Respondent has challenged the jurisdiction of the Tribunal has to issue the orders sought by the Tenant/Applicant by contending that the Tribunal has no jurisdiction to issue “injunctive orders.” There have been instances where the jurisdiction of this Tribunal with regard to issuing injunctive relief has been challenged and the issue has been well canvassed in the Courts and I shall outline the same herein.

18. However, it is important to first set out that the Tribunal’s jurisdiction emanates from section 12 of the Landlord and Tenant (shops, Hotels and Catering Establishments) Act under which subrule (4) provides:

(4) In addition to any other powers specifically conferred on it by or under this Act, aTribunal may investigate any complaint relating to a controlled tenancy made to it by the landlord or the tenant, and may make such order thereon as it deems fit…(own emphasis)

19. The Court in Nairobi Civil Appeal No. 205 of 1995 Narshidas & Co. Ltd –Vs- Nyali Air Conditioning & Refrigeration Ltd endorsed the proposition in The Republic –Vs Nairobi Business Premises Rent Tribunal & Others Ex parte Karasha [1979] KLR 147 and Re Hebtulla Properties Limited [1979] KLR 96 that the Tribunal does not have jurisdiction to grant an order of injunction.

20. However, there is a view that the Tribunal can nevertheless issue orders to preserve a tenancy which is the subject of proceedings before it. The Court, in Mombasa Misc. Application (J.R) No. 26 of 2010 The Chairman Business Premises Rent Tribunal at Mombasa Ex parte Baobab Beach Resort (Mombasa)Ltd stated as follows:

“An order for status quo to be maintained is different from an order of injunction both in terms of the principles for grant and the practical effect of each. While the latter is a substantive equitable remedy granted upon establishment of right, or, at interlocutory stage, a prima facie case, among other principles to be considered, the former is simply an ancillary order for the preservation of the situation as it exists in relation to pending proceedings before the hearing and determination thereof. It does not depend on proof of right or prima facie case. In its effect, an injunction may compel the doing or restrain the doing of a certain act, such as, respectively, the reinstatement of an evicted tenant or the eviction of the tenant in possession. An order for status quo merely leaves the situation or things as they stand pending the hearing of the reference or complaint. In its negative form, however, an injunction may have the same effect as an order for status quo. I find that the Tribunal has among the orders that it may make on a complaint under Section 12(4) of the Landlord and Tenant Act an order for status quo to hold the situation in the controlled tenancy until the determination of the proceedings filed thereon.”

21. The Court in Rent Restriction Tribunal v Raval Ex-Parte Mayfair Bakeries Limited, [1985] Klr 167stated that although the Act does not specifically mention the word “injunction” but, it does speak of an “order”. The Court went ahead to state that:

“In Volume 21 ofHalsbury’s Laws of England, (3rd edition) at page 343, an injunction is defined as-

“a judicial process whereby a party is ordered to refrain from doing or to do a particular act or thing. In the former case it is called a restrictive injunction, and in the latter, a mandatory injunction.”

Again inSutton & Shannon on Contracts, 6th edition, it is stated at page 396: -

“An injunction is an order of the court granted for the purpose of restraining the doing, continuance or repetition by the person enjoined, his servants or agents, of some wrongful act which constitutes an infringement of a legal or equitable right …”

22. I hereby find that the Tribunal indeed has jurisdiction to grant injunctive orders in relation to disputes falling within its jurisdiction. That there would be no purpose of the Tribunal entertaining and investigating a complaint if it cannot issue orders preserving status quo pending the hearing and determination of the suit. Furthermore, pursuant to Article 169 of (1)(a) of the Constitution of Kenya 2010, tribunals are subordinate courts and by dint of their status as subordinate courts, they have jurisdiction under Sections 3A and 40 of the Civil Procedure Act to issue injunctive orders.

23. Therefore, having considered the circumstances of the case and the Tenant/Applicant’s application dated 18th January, 2021, I hereby find that the application is allowed and I hereby make orders that a temporary injunction issues restraining the Respondents from evicting the Applicant and to maintain the status quo until the Landlord issues a proper notice to the Tenant/Applicant within the confines of the law because the Tribunal no jurisdiction to terminate a tenancy without a notice under Section 4 of the Act.

HON. ANDREW MUMA

VICECHAIR

BUSINESS PREMISES RENT TRIBUNAL

RULING DELIVERED ELECTRONICALLY THIS 14TH DAY OF APRIL, 2021.

HON. ANDREW MUMA

VICECHAIR

BUSINESS PREMISES RENT TRIBUNAL