Kenneth Mugambi Kimencu t/a Drink Depot v Mark Gitonga Thiringi & Ivyonne Saina [2021] KEBPRT 158 (KLR)

Full Case Text

REPUBLIC OF KENYA

BUSINESS PREMISES RENT TRIBUNAL

VIEW PARK TOWERS 7TH & 8TH FLOOR

TRIBUNAL CASE NO. E204 OF 2021 (NAIROBI)

KENNETH MUGAMBI KIMENCU

T/A DRINK DEPOT.............................................APPLICANT/TENANT

VERSUS

MARK GITONGA THIRINGI.........1ST RESPONDENT/LANDLORD

IVYONNE SAINA....................................................2ND RESPONDENT

RULING

1. Through a notice of motion dated 14th June 2021, the applicant moved this tribunal seeking for an order of injunction against the Respondents to restrain them from interfering with the quiet possession of shop no. GF1 in parcel no. Thika Town Plot No. 36/553 located along Thika Garissa road.

2. He further seeks for an order declaring the action by the Respondent of locking and/or closing shop no. GF1 as illegal and unlawful since there are no rent arrears.

3. Prayers 2 and 5 were granted at the ex-parte stage and do not therefore fall for determination.

4. The application is supported by the applicant’s affidavit sworn on 14th June 2021 and the grounds set out on the face of the application.

5. It is the applicant’s case that he is a tenant at the Respondent’s premises where he operates a business known as “Drink Depot along Thika /Garrisa road, Thika Town, Kiambu county.

6. The applicant contends that he has been faithfully paying rent on time and had no arrears as at the time of filing the motion.

7. In a move aimed at harassment and invasion of the applicant’s shop and chasing him away, the Respondents closed his shop on a date which is not indicated in the filed pleadings.

8. According to the applicant, his monthly rent was agreed upon in December 2019 at Kshs.32,500/- through an oral agreement. Rent for the premises is paid to the 2nd Respondent.

9. The Applicant purports to have attached Mpesa statements to the supporting affidavit but none is attached to the copy filed in court.

10. The applicant depones that the Respondents instructed persons purporting to be welders to permanently close his shop without justifiable reasons. The said shop was his only source of livelihood whereon he had established goodwill which could not be quantified in monetary terms.

11. As such, the applicant contends that he will suffer irreparable harm to his business reputation unless the orders are granted. He further pleads that he stood to suffer a miscarriage of justice if the orders were denied.

12. The application is opposed through the Respondents’ grounds of opposition dated 14th July 2021 and a replying affidavit sworn by the 1st Respondent on 19th July 2021.

13. The first issue raised is that there exists no landlord and tenant relationship between the applicant and the Respondents.

14. It is the respondents’ case that the relationship between the applicant and the 1st Respondent was a partnership to carry on the business of liquor store/shop with a view of making profits on plot no. 36/663 along Thika/Garissa Road.

15. It is the respondents’ contention that the applicant moved the court with unclean hands and neglected to disclose material facts germane to the cause that he was merely a partner in the business with the 1st Respondent and the instant suit was intended to deny the latter of his rightful share.

16. The applicant is said to have concealed that he was a fulltime public servant employed as a teacher at Mugwanjogu Primary School in Mbeere, Embu County and the suit premises was therefore not his only source of livelihood as contended.

17. The Respondents deny any harassment or threat on the person of the Applicant.

18. According to the Respondents, the Applicants’ only contribution to the partnership was the certificate of registration of the business and he does not stand to suffer irreparable loss and damage.

19. It is the Respondents’ case that the 1st Respondent stands to suffer prejudice by being kept out of his property should this Tribunal allow the application. This would make him suffer loss of income and use of his property.

20. The applicant is said to be a nephew of the 1st Respondent and he conceived the liquor selling business where upon the latter contributed land and business capital for the partnership.

21. The partnership business was to meet all running expenses such as rent, restocking, renumeration of employees and other costs reasonably incurred and the profits were to be shared equally.

22. Over and above sharing of profits, the business was to pay the 1st Respondent a modest sum as rent over and above his share of the profits as the premises were not to be let out to anybody else and as such the use of the premises did not crystallise a tenancy between the applicant and the 1st Respondent.

23. The partnership is said to have collapsed and the premises had to naturally revert back to the 1st Respondent.

24. Evidence of the financial contribution made by the 1st Respondent has been annexed to the replying affidavit as well as various conversations on the progress of setting up the business between him and the applicant to demonstrate the relationship.

25. Discussions on how the business was performing and profits realized have been exhibited by the 1st Respondent. The same has not controverted by the applicant through a further affidavit.

26. A disagreement arose between the applicant and the 1st Respondent due to the former failing to account and locking him out of access to the management system after he changed the log in credentials to deny him information on the business.

27. The 1st Respondent requested for a halting of business but the applicant is said to have continued running it whereupon the former ordered the business locked pending a joint review of the partnership and recovery plan.

28. However the business was broken open by the applicant and a report was made on behalf of the 1st Respondent to Thika Police Station on 12th June 2021 whereupon the applicant rushed to this Tribunal.

29. The matter was directed to proceed by way of written submissions and both parties complied.

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

(a) Whether there exists to landlord and tenant relationship to warrant the granting of the orders sought.

(b) Who is liable to pay costs of the application?.

31. Although the 1st Respondent filed a detailed affidavit in response to the application explaining in minute details how his relationship with the applicant started, there is no further affidavit filed by the latter to controvert the said depositions.

32. The question as to whether there exists a landlord and tenant relationship between the parties herein goes into the issue of jurisdiction of the tribunal. Under section 12(1)(a) of Cap. 301, Laws of Kenya, this Tribunal is empowered to determine whether or not any tenancy is a controlled tenancy.

33. Section 12(4) of the said Act empowers the Tribunal to 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.

34. Having analysed the evidence tendered by both parties, I have come to the irresistible conclusion that the relationship between the Applicant and the 1st Respondent is one of partnership as opposed to landlord and tenant. Any rent paid to the 1st Respondent was made by the partnership as a running cost and could not elevate the applicant into a tenant of the 1st Respondent.

35. In absence of a landlord/tenant relationship between the parties herein, the Tribunal is divested of jurisdiction to determine the dispute brewing between the two parties.

36. When the applicant rushed to this Tribunal to obtain ex-parte orders, he failed to make material disclosure that he was not a tenant but a partner of the 1st Respondent who had directed the halting of the business to allow for review and crafting of a recovery plan. This concealment of material facts is fatal to the application in line with the decision in the case of Gabriel Kariuki Gitonga & 2 others – vs- Redken Wells Ltd & 11 others (2021) eKLR where it was held at paragraphs 11 and 12 as follows:

“11. In Kenya Electricity Transmission Company Limited – vs- Kibutu Limited (2019) eKLR, the court observed:-

The fundamental principles of non-disclosure of material facts that an applicant must adhere to are:-

(a) The applicant is under an obligation to the court to make the fullest possible disclosure of all material facts within his knowledge.

(b) The duty of disclosure therefore applies not only to material facts known to the Applicant but also any additional facts which h would have known if he had made sufficient inquiries.

(c) The extent of the inquiries which will be held to be proper and therefore necessary must depend on all the circumstances of the case which the applicant is making when he makes the application. (b) the order for which the application is made and the probable effect of the order on the defendant and (c ) the degree of legitimate urgency and the time available for the making of the inquiries.

(d) Whether the fact not disclosed is of sufficient materiality to justify or require immediate discharge of the order without examination of the merits depends on the importance of the fact to issues which were to be decided by the judge in the application.

(e) The question whether the non -disclosure was innocent, in the sense that the fact was not known to the applicant to make all proper enquiries and to give careful consideration to the case being presented.

(f) Finally, it is not every omission that the order will be automatically discharged.

(g) Material non-disclosure is a serious issue which once the court is made aware of it, would lead to the setting aside and discharge of an ex-parte order forthwith. Good faith is so central in an ex-parte circumstances must be absolutely truthful”.

37. Having found as above, it is my considered view that this Tribunal had no jurisdiction to entertain this matter in the first place and the ex-parte orders given were issued in error and ought to be discharged forthwith.

38. In the premises, I proceed to make the following final orders:

(a) The application dated 14th June 2021 and the entire reference are hereby dismissed with costs.

(b) The ex-parte orders given on 16th June 2021 are hereby discharged and set aside.

It is so ordered.

DATED, SIGNED & DELIVERED THIS 30TH DAY OF SEPTEMBER 2021 VIRTUALLY.

HON. GAKUHI CHEGE

VICE CHAIR

BUSINESS PREMISES RENT TRIBUNAL

In the presence of:-

Miss Wafula holding brief for Shikalela for Tenant

Mwisigua for the Respondents