Kamkis Trading Company Limited v Oxford Quality Part Limited & another [2025] KEBPRT 188 (KLR)

Kamkis Trading Company Limited v Oxford Quality Part Limited & another (Tribunal Case E549 of 2024) [2025] KEBPRT 188 (KLR) (29 January 2025) (Ruling)

Neutral citation: [2025] KEBPRT 188 (KLR)

Republic of Kenya

In the Business Premises Rent Tribunal

Tribunal Case E549 of 2024

P Kitur, Member

January 29, 2025

Between

Kamkis Trading Company Limited

Applicant

and

Oxford Quality Part Limited

1st Respondent

Gerald Mwaniki Mbaga

2nd Respondent

Ruling

A. Parties 1. The Applicant is the registered owner of the premises at LR No 209/7994 Shop No 9 (‘the suit premises’).

2. The firm of Kinuthia Kahindi & Company Advocates represents the Applicant/Landlord.

3. The Respondent operated a shop that traded in auto spares, within the suit premises as a tenant of the Applicant/Landlord.

4. The firm of Wakahu Mbugua & Company Advocates represents the Respondents.

B. The Dispute Background 5. The parties entered into a tenancy agreement concerning the suit premises, with the Tenant agreeing to pay a monthly rent of Kshs 214,600/- for the occupation of the suit premises. The Tenant occupied the premises from 2016 to March 2023.

6. On 8th February 2023, the Tenant issued a notice to vacate the premises, citing the intention to cease business operations by 1st March 2023 due to poor business performance, which had rendered them unable to meet the rent obligations. The Tenant, however, promised to settle any outstanding rent arrears.

7. On 13th May 2024, the Landlord filed a Complaint to the Tribunal, seeking redress for the Tenant’s failure to settle arrears amounting to Kshs 661,600/-. The Landlord also filed an Application on even date, seeking an order of the Tribunal compelling the Tenant to pay the outstanding arrears. The Landlord further sought an order for the attachment and sale of the Tenant’s property if the arrears were not paid within a specified period, as well as an order for costs of the application.

8. The application was based on the grounds that the Tenant, who vacated the premises in February 2023, acknowledged the debt owed to the Landlord but had failed to make any payments towards the arrears despite the considerable time lapse.

9. In its Defence dated 10th July 2024, the Respondent admitted to owing the Landlord rent arrears, which it attributed to business failure. The Respondent denied the claim that it had refused to pay the arrears, explaining that it had faced financial difficulties and had even secured a loan to sustain the business. Despite these efforts, the business ultimately failed, prompting the Respondent to shut down operations and vacate the premises. The Respondent also claimed to have previously made a payment of Kshs 1,556,035/- to the Landlord, which, according to the Respondent, had not been accounted for by the Landlord. The Respondent requested that this sum be applied against the arrears.

10. Additionally, the Respondent filed a Replying Affidavit sworn by Gerald Mwaniki Mbagi on 21st August 2024, contesting the Landlord’s application.

11. The Applicant/Landlord responded with a Supplementary Affidavit sworn on 23rd August 2024 by Janet Kambale, the authorized agent of the Landlord. In this affidavit, the Applicant reiterated that the Tenant had acknowledged the debt, and called on the Tribunal to hold the Tenant liable for the arrears. The Applicant further challenged the Respondent to provide proof of any payments made to the Landlord.

12. On 31st July 2024, during the hearing of this matter, the Tribunal directed that the suit be disposed of by way of written submissions, to which both parties duly complied.

13. Further, on 13th November 2024, the Tribunal directed the parties to address the issue of jurisdiction, considering that the suit was filed after the Tenant had vacated the premises. Both parties subsequently submitted their respective arguments on the jurisdictional issue.

14. Upon careful review of the foregoing by this Tribunal, the following issues arise for determination.

C. List Of Issues for Determination i. Whether the Tribunal has jurisdiction to determine the matter, given that the suit was filed after the Tenant had vacated the premises. D. Analysis And Findings 15. It is a well-settled principle of law that jurisdiction is everything and once challenged, a determination should be made before the Tribunal can proceed with further disposal of any matter thereto. The Tribunal has no option but to first determine whether it is clothed with jurisdiction in the matter. In the case of Owners of the Motor Vessel ‘Lillian” (s) v Caltex Oil (Kenya) Ltd [1989] KLR1, the Court stated as follows:“Jurisdiction is everything. Without it, a court has no power to make one more step. Where a court had no jurisdiction, there would be no basis for a continuation of proceedings pending other evidence. A court of law downs tools in respect of the matter before it the moment it holds the opinion that it is without jurisdiction.”

16. In the case of Samuel Kamau Macharia &anotherv Kenya Commercial Bank Limited & 2 others [2012] eKLR, the Supreme Court of Kenya had the following to say at paragraph 68 on the question of jurisdiction:-“A court’s jurisdiction flows from either the Constitution or legislation or both. Thus, a court of law can only exercise jurisdiction as conferred by the Constitution or other written law. It cannot arrogate to itself jurisdiction exceeding that which is conferred upon it by law……the issue as to whether a court of law has jurisdiction to entertain a matter before it is not one of mere procedural technicality, it goes to the very heart of the matter, for without jurisdiction, the court cannot entertain any proceedings”.

17. This Tribunal derives its jurisdiction from the Landlord and Tenant (Shops, Hotels, and Catering Establishments) Act (Cap 301) (‘the Act’). The Act empowers the Tribunal to handle disputes between landlords and tenants of business premises. However, the Tribunal’s jurisdiction is typically limited to matters arising during the subsistence of the tenancy.

18. Section 12(4) of cap 301, Laws of Kenya confers this tribunal jurisdiction to investigate any complaint relating to a controlled tenancy made to it by the landlord/tenant and make such order thereon as it deems fit. As such, the first qualification is that there must be in existence a landlord and tenant relationship. In absence of such a relationship, the tribunal has no jurisdiction.

19. In Republic v Chairperson - Business Premises Rent Tribunal at Nairobi & another Ex-Parte Suraj Housing & Properties Limited & 2 others [2016] eKLR, the Judge cited with approval the case of Pritam v Ratilal and another Nairobi HCCC No 1499 of 1970 [1972] EA 560 where it was stated as follows:“Therefore the existence of the relationship of landlord and tenant is a pre-requisite to the application of the Act and where such relationship does not exist or it has come to or been brought to an end, the provisions of the Act will not apply. The applicability of the Act is a condition precedent to the exercise of jurisdiction by a Tribunal; otherwise the Tribunal will have no jurisdiction. There must be a controlled tenancy as defined in section 2 to which the provisions of the Act can be made to apply. Outside it, the Tribunal has no jurisdiction.”

20. In this case, the landlord filed the reference on 13th May 2024, after the Tenant vacated the premises on 1st March 2023. No tenancy relationship existed between the parties at the time of filing the suit. Consequently, this suit was instituted after the Landlord – Tenant relationship had been brought to an end.

21. From the foregoing analysis, there exists no tenancy between the parties that can be termed as a controlled tenancy, which therefore ousts this tribunal’s jurisdiction to hear and determine the dispute.

22. I therefore proceed to order as follows:-

E. Ordersa.The entire suit is hereby dismissed for want of jurisdiction.b.Any Orders granted herein are discharged.c.Costs are awarded to the Respondents assessed at Kshs 40,000/=.d.The file is marked as closed.

HON P. KITURMEMBERBUSINESS PREMISES RENT TRIBUNALRuling dated, signed and delivered virtually by Hon P. Kitur this 29th day of January 2025 in the absence of the parties.HON P. KITURBUSINESS PREMISES RENT TRIBUNAL