JOHN CHRISTOPHER KAMAU v THE CO-OPERATIVE BANK OF KENYA [2004] KEHC 70 (KLR)

REPUBLIC OF KENYA IN THE HIGH COURT OF KENYA AT NAIROBI (MILIMANI COMMERCIAL COURTS)

Civil Case 13 of 2004

JOHN CHRISTOPHER KAMAU................................PLAINTIFF

- VERSUS-

THE CO-OPERATIVE BANK OF KENYA...........DEFENDANT

RULING

By a charge dated 4th March, 1994 and executed between theplaintiff and the defendant, the plaintiff, as chargor, charged hisproperty known as Title Number Dundori/Lanet Block 4/22/Nyonyoroto secure a loan of Ksh.700,000/= advanced to a third party or thirdparties. The third party did not service the loan. On 8th September,1998, the defendant sent a statutory notice to the plaintiffdemanding payment of the outstanding sum plus interest. By a letterdated 10th November, 2003 M/S Baseline Auctioneers, sent a 45days notification of sale to the plaintiff threatening to sell the saidproperty by public auction on 23rd January, 2004.

Arising out of the above state of affairs, the suit herein wascommenced by a plaint dated 24th December, 2003 but filed in court on 9th January, 2004. True to what seems to have become acommon practice, along with the plaint was filed a chambersummons “under O.XXXIX and High Court Vacation Rules, Rule,Section 3A of the Civil Procedure Act and all enabling provisions ofthe law. The main order which the application seeks is that thedefendants be restrained from selling or advertising for sale oralienating Title Number Dundori/Lanet Block 4/22 (Nyonjoro) untilthe determination of this suit. The main grounds upon which theapplication is premised are that the intended sale of the plaintiff'sproperty by the defendant is illegal for want of service of a properstatutory notice and that the intended sale is also illegal for want of aproper notification of sale.

On 22nd January, 2004 the advocates for the defendant filed anotice of a preliminary objection. It stated that the defendant would,at the hearing of the plaintiff's injunction application herein, raise apreliminary objection that this court has no jurisdiction to entertainthe said application on the ground that the issues raised by theplaintiff regarding the statutory notice served on him by thedefendant were also raised in the plaintiff's earlier suit filed at Nakuru, i.e. HCCC No. 28 of 1999, whereof the plaintiff's injunctionapplication filed therein was dismissed and therefore the presentapplication herein is res judicata. Mr. Kimondo Mubea, for thedefendant/respondent, took up this point when the matter came forhearing on 6th February, 2004.

Mr. Mubea argued that when the plaintiff filed suit No.28 of1999 at Nakuru, he was already in possession of the statutory noticewhich had been served on him. In spite of being in possession, henever challenged the validity of that notice. Mr. Mubea referred tos.7 of the Civil Procedure Act and submitted that if there was anydefect in that notice, then the plaintiff ought to have raised the issuein that suit. The matter is therefore res judicata.

Secondly, Mr. Mubea referred to the allegation that theintended sale is illegal for want of proper notification. This was oneof the issues between the parties in the application at Nakuru inHCCC No. 28 of 1999, which application was dismissed by JusticeVisram. Consequently, Mr. Mubea submitted that the issue was alsores judicata. Thirdly, Mr. Mubea also submitted that this applicationis an abuse of the process of the court.  In paragraph 15 of the Plaint, the plaintiff says that there is another suit pending in Nakuru,yet, although he resides in Nakuru and the property is in Nakuru, hedoes not file this application in Nakuru, and he does not disclose thatthe initial chamber summons application at Nakuru was dismissed.Mr. Mubea urged the court to uphold the preliminary objection.

In response, Mr. Obura for the plaintiff argued that in theapplication at Nakuru, what was being challenged was the statutorynotification of sale, and that the issue of the statutory notice wasneither raised nor canvassed. He submitted that the issue of thevalidity of the statutory notice under s. 74 of the Registered Land Actwas not finally heard and determined. Counsel said he knew that Mr.Mubea would say that the issue ought to have been canvassed, butthat it would be contrary to public policy if the chargee herein wasallowed to hide under doctrines. Mr. Obura admitted that it was truethat the plaintiff had not pleaded that the statutory notice was invalidbut at the same time, he submitted, the court did not find it valid.He further submitted that res judicata does not absolve a chargeefrom complying with the law and serving a valid statutory notice, andthat the notice cannot validate an invalid notice.  He concluded by stating that the doctrine of res judicata does not apply to the presentsuit.

In a short reply, Mr. Mubea stated that the plaintiff had anopportunity to raise these matters in the Nakuru application, butsince he didn't do so, the matter is now a closed chapter. He urgedthe court to uphold the preliminary objection and strike out theapplication.

After hearing these rival submissions, I find that the question to be determined herein is whether the two issues of the statutory notice and notification of sale were issues in the suit and chamber summons application in Nakuru HCCC NO. 28 of 1999, and if not whether they ought to have been made issues. The relevant portion of paragraph 8 of the plaint file in Nakuru HCCC No. 28 of 1999

reads-

"...the 1st and 2nd defendants... have failed toservice the loan and the 3rd defendant hasnow issued a statutory notice against theplaintiff's property, and threatens, unlessrestrained by this Honourable Court, to sellthe same in order to recover the loan andinterest thereon."

In the clause for prayers, the plaint reads-

"REASONS WHEREFORE the plaintiff prays forjudgment and orders against the defendantsjointly and severally in the following terms:-(a)

(b)

(c)

(d)  an order restraining the 3rd defendantfrom realizing the security or otherwise exercising its powers of sale over thesaid property."(e)It goes without saying that even at the time of the filing of the case in Nakuru, the plaintiff had already received the statutory notice threatening to sell his property.  If he had any misgivings about the propriety of that notice, this was the right forum to raise the issue.

Indeed, any shortcomings in the validity of that notice should have strengthened his prayer for an order restraining the third defendant, who is the sole defendant herein, from realizing the security or

otherwise exercising its powers of sale over the property.  The invalidity of such a notice is so central to the success or otherwise of a suit claiming an injunction of this nature that it is one of the issues that the chargor would invariably be on the look out for. Althoughthat notice was specifically mentioned in the plaint, it was neverchallenged. From that perspective, it seems that the plaintiff wasperfectly at home with the validity of that notice at that time. Nowhe seeks to challenge it. It appears to be too late in the day for himto do so.

s. 7 of the Civil Procedure Act states-

"No court shall try any suit or issue inwhich the matter directly and substantially inissue has been directly and substantially inissue in a former suit between the sameparties, or parties under whom they or any ofthem claim, litigating under the same title, ina court competent to try such subsequent suitor the suit in which such issue has beensubsequently raised, and has been heard andfinally decided by such court."Explanation (4) to this section reads-

"Any mater which might and ought to havebeen made ground of defence or attack insuch former suit shall be deemed to havebeen a matter directly and substantially inissue in such suit/'The invalidity of the statutory notice clearly might and ought to have been made a ground of attack in the former application at Nakuru.  It is therefore deemed to have been a matter directly and substantially in issue in that application and therefore it is res judicata.  In MBURU KINYUA V. GACHINI TUTI [19781 KLR. 69, at page 73, Madan J.A. said-

"... the liberty to present more than oneapplication is always subject to the court'spower to prevent abuse of its process... It isalso of course subject to the rule of resjudicata including what is laid down inexplanation (4) to section 7, unless a special circumstance is present in which event Iwould be content to follow the following dictum of Wigram V-C, in Henderson v.Henderson [1843] 67 E.R. 313, 319, which thePrivy Council described as the locus classicusof this aspect of res judicata, in Yat Tung Investment Co. Ltd., v. Pao Hena Bank Ltd.[1975] A.C. 581, 590;

where a given matter becomes the subjectof litigation in, and adjudication by, a court ofcompetent jurisdiction, the court requires theparties to that litigation to bring forward theirwhole case, and will not (except under specialcircumstances) permit the same parties toopen the same subject of litigation in respectof the matter which might have been broughtforward, as part of the subject in contest, butwhich was not brought forward, only becausethey have, from negligence, inadvertence, oreven accident, omitted part of their case. Theplea of res judicata applies, except in specialcases, not only to points upon which the courtwas actually required by the parties to forman opinion and pronounce a judgment, but to every point which properly belonged to thesubject of litigation, and which the parties, exercising reasonable diligence, might havebrought forward at the time'."The plaintiff's first opportunity to challenge the statutory notice presented itself in the Nakuru application. He ought to have taken it then.  But he didn't.  No reason is given as to why he didn't. I find that he might and ought to have brought it up then, and thattherefore the matter is res judicata. With respect, Mr. Obura missesthe point when he asks the court to decide whether res judicata canvalidate an invalid statutory notice. That is not the point. The pointis that the issue of the validity or otherwise of the statutory notice ought to have been raised in the earlier application, and since it wasnot so raised, raising it in the present application falls foul of resjudicata.

The above observations apply with equal force to the issue ofthe notification of sale. I agree with Mr. Mubea that an auctioneerneed not issue a 45 day notification of sale every time an auction saledoes not go through. NATHAKAL MONJI RAI V. STANDARD BANK(K)LIMITED & ANOR. Milimani Civil Case No. 830 of 1999 isadequate authority for that proposition. But in the instant case, theplaintiff says that sometime in November, 2003 he received anotification of sale from the post office giving him 45 days notice thathis property would be sold. In her replying affidavit, Regina K. Anyika, a legal officer at the defendant bank, avers on informationfrom the auctioneers, that besides the notification of sale which was sent to the plaintiff by registered post, there was also a personal service of the same upon him. This statement finds corroboration onpage 19 of the defendant's bundle of documents, which is a 45 daynotice and which seems to have been signed by the plaintiff on orabout 15th November, 2003. On the face of the record, the noticeappears to be regular and to have been properly served. But quiteapart from the fact that this notice need not have been served in thefirst instance as the plaintiff had been served earlier on 11th April,2001, that is beside the point.

The point is that in his ruling dated 23rd May, 2002 in theNakuru application justice Visram expressly stated that one of theissues raised by the plaintiff was that he was not served withnotification of sale of the suit land as required by law. The courtfound that the plaintiff was actually served with the notice on 11thApril, 2001 when he personally, signed on the notice documentsignifying its receipt by him. One of the grounds in the applicationbefore this court is that the intended sale is illegal for want of propernotification of sale. As stated earlier, even though there was noobligation on the part of the defendant to serve the plaintiff with second notice, he was served on 15th November, 2003. Besides that,an earlier notice was served on 11th April, 2001. That issue wasdetermined in the Nakuru application. The matter is therefore resjudicata.

The upshot of the above is that the preliminary objection isupheld and the chamber summons application dated 24th December,2003 is dismissed with costs to the defendant/respondent.  Theinterim orders granted on 9th January, 2004 are hereby vacated.

Dated and delivered at Nairobi this 25th day of March 2004

L. NJAGI

JUDGE