Kiringo v Omondi [2025] KEBPRT 200 (KLR) | Controlled Tenancy | Esheria

Kiringo v Omondi [2025] KEBPRT 200 (KLR)

Full Case Text

Kiringo v Omondi (Tribunal Case E018 of 2024) [2025] KEBPRT 200 (KLR) (Civ) (10 February 2025) (Judgment)

Neutral citation: [2025] KEBPRT 200 (KLR)

Republic of Kenya

In the Business Premises Rent Tribunal

Civil

Tribunal Case E018 of 2024

P Kitur, Member

February 10, 2025

Between

Julius Mwitho K Kiringo

Applicant

and

Erick Dennis Omondi

Respondent

Judgment

A. Parties 1. The Applicant is the registered proprietor of the premises located at plot No. 7845/Kangeta/Kangeta within Kangeta Market (hereinafter referred to as ‘the suit premises’).

2. The firm of K.K Waithanji & Company Advocates represents the Applicant/Landlord.

3. The Respondent is a businessperson operating a retail supermarket within the suit premises as a tenant of the Landlord.

4. The firm of Kipkorir & Wanyama LLP represents the Respondent/Tenant.

B. The Dispute Background 5. The parties entered into a tenancy relationship vide a tenancy agreement dated 1st May 2023 for the suit premises. The tenancy was for a term of 5 years commencing on 1st June 2023, with the Respondent paying a monthly rent of Kshs. 35,000/- in exchange for the suit premises. The agreement between the parties was duly executed and witnessed by both parties.

6. The tenancy went on uninterrupted until 21st December 2023 when the landlord issued upon the tenant a notice to terminate the tenancy under section 4(1) of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act Cap. 301 Laws of Kenya (the Act). The Landlord sought to terminate the tenancy on the grounds that the tenant failed to honor the terms of the lease agreement between them, specifically by not paying rent amounting to Kshs. 90,000/- up to December 2023 and failing to pay utility bills.

7. The Landlord filed a Complaint to this tribunal under section 12(4) of the Act, raising a complaint against the Tenant for refusing to pay rent, and the utility bill and for refusing to vacate the suit after being served with a termination notice.

8. Additionally, the Landlord filed a Notice of Motion Application dated 25th March 2024 under a certificate of urgency together with a supporting affidavit sworn by himself on even date. The Landlord sought for the following orders:i.That the tenant be ordered to give vacant possession of the business premises located at Meru-Kangeta immediately on account of non-payment of rent arrears of Kshs. 145,000/- inclusive of utility bills and in default, the OCS Kangeta Police Station to enforce eviction.ii.That the court waives 10% court fees since the landlord cannot raise the said amounts due to the non-payment of rent by the Tenant.iii.That the landlord be granted leave to break into the tenant's business premises located at Meru-Kangeta gain access and let it to another tenant under the supervision of OCS Kangeta Police Station.iv.The OCS Kangeta police station to ensure compliance.v.The costs of this application be provided for.

9. The Application was supported by the grounds adduced therein as well as those in the sworn affidavit of the Landlord. The main grounds are that the tenant remained in occupation of the suit premises despite being served with a termination notice to vacate. Despite receiving the notice, the tenant neither paid the rent arrears, in breach of the tenancy agreement, nor challenged the notice as provided under the Act.

10. The Landlord effected service of the Application upon the respondent through a process server who filed an affidavit of service dated 31st May 2024.

11. The Respondent filed a Replying Affidavit sworn by himself on 3rd June 2024 in response to the Application. He acknowledged the tenancy relationship between himself and the landlord herein. It stated that the lease between the parties was without an option of termination and therefore the said termination by the landlord was illegal and contrary to the terms of the lease agreement. It denied being served with a notice to terminate the tenancy and that the landlord failed to observe the procedure of service of notices as laid out in the lease agreement. He denied being in arrears and further stated that He made an excess payment in the sum of Kshs. 434,550/- for the first year of tenancy. He opined that the application by the applicant was a form of witch-hunt for the reasons outlined in the affidavit and further prayed for the Application to be dismissed in its entirety.

12. The Landlord filed a Further Affidavit sworn on 7th August 2024 in response to the tenant's Replying Affidavit.

13. The tenant filed a notice of motion application dated 3rd June 2024 seeking an order from the court to compel the landlord to refund the sum of Kshs. 46,377/- that was used to pay the accrued utility bill. Secondly, the landlord be compelled to reopen the washroom in the suit premises and hand over the key to the back door of the demised premises to the tenant. The tenant also sought an injunction restraining the landlord from interfering with their occupation of the premises.

14. The tenant's application was supported by grounds set out in the application and an affidavit annexed thereto. The landlord filed a replying affidavit on 7th August 2024 in response, while the tenant filed a supplementary affidavit sworn on 26th August 2024.

15. During the hearing of the matter on 3rd September 2024 the parties called their witnesses who testified in support of their cases. It was mutually agreed between the parties to have the two applications heard together.

16. Testimony of Mr. Julius Kiringo

17. Counsel for the Landlord introduced Julius Kiringo, the landlord, as the first witness. Julius confirmed filing the Application dated 25th March 2024, along with the Further Affidavit and Replying Affidavit sworn on 7th August 2024, and wished to admit them as his evidence in chief. He described entering into the tenancy agreement with the Respondent, the terms of the tenancy, and the tenant's failure to pay rent and utility bills, which led to the notice of termination. Specifically, the tenant failed to pay a balance of Kshs. 100,000/- in full.

18. During cross-examination, the landlord acknowledged the absence of a termination clause in the lease agreement and confirmed serving the notice via WhatsApp as well as in person through its agent. He verified that the tenant paid Kshs. 434,550/- against an annual rent of Kshs. 420,000/-. The landlord also acknowledged the tenant's payment of Kshs. 105,000/- on 24th August 2024 and the tenant's payment of an accrued utility bill of Kshs. 46,377/-. He mentioned that the issue of the backdoor key was not raised until the suit was filed.

19. During re-examination, the landlord reiterated issuing the termination notice due to the unpaid rent balance of Kshs. 100,000/-, that He served the termination notice upon the respondent via WhatsApp and through his agent, and that is has not yet received the full balance. He noted the tenant's payment of Kshs. 105,000/- a week before the hearing, leaving a balance of Kshs. 105,000/- plus utility bills. He testified that the tenant was responsible for deducting the accrued utility bill from rent payments.

20. Testimony of Ernest Mugambi Thuranira

21. The witness adopted his witness statement dated 7th August 2024 produced under paragraph 15 of the Further Affidavit.

22. The witness testified that he was aware of the tenancy agreement between the parties. He admitted not being a listed agent and lacked documentation to prove his agency status. However, he confirmed effecting service of the termination notice upon the respondent, though he had no proof of service.

23. The witness explained that he acted as an agent of the landlord by connecting the tenant in need of business premises to the landlord. He reiterated effecting service of the notice but lacked proof because the respondent refused to sign their copy.

24. Testimony of Eric Dennis Omondi

25. In his testimony, the witness requested to have his affidavits adopted as evidence and claimed he cleared all rents for 2024 with a payment of Kshs. 70,224/- on 13th October 2024. He stated he paid for the building's electricity bill but was denied access to part of the building when the landlord partitioned it. He also mentioned not receiving a notice as he was on holiday on 28th December 2023.

26. During cross-examination, the witness confirmed entering the lease agreement on 1st May 2023 and taking possession on 1st June 2023. The rent was Kshs. 35,000/- per month, or Kshs. 420,000/- per year, though he was unclear on the payment schedule. He testified that he paid a rent deposit of Kshs. 110,000/-, leaving a balance of Kshs. 100,000/- to be paid by 1st July 2023, which he cleared on 18th January 2024. The witness denied breaching the lease agreement and stated he had settled all dues to the landlord before the lawsuit.

27. At the end of the hearing, the parties were directed to file their respective submissions, which they complied.

28. The landlord argued that the tenancy constituted a controlled tenancy, conferring jurisdiction to the Tribunal. The landlord maintained that the notice to terminate the tenancy and the reasons for termination were valid and compliant with statutory requirements. The landlord cited the case of Wafula v Khamali e062 of 2024 KEBRT 1538 (KLR) and stated that the tenant breached the lease agreement by not paying the rent balance, thereby entitling the landlord to the reliefs sought. The landlord also provided evidence of past communication with the tenant through the correct phone number, acknowledging a typographical error in the notice. Lastly, the landlord argued that the tenant's application dated 3rd June 2024 was without merit, as the tenant was obligated to deduct the accrued utility bill before making rent payments and that the keys had already been handed over to the tenant.

29. The tenant argued that the termination notice served by the landlord was invalid due to improper service and contrary to the lease agreement provisions. The tenant claimed that the lease did not provide for termination, meaning the tenancy was to run until the end of its term. The tenant denied breaching the lease agreement regarding rent payments and argued that the landlord was indebted for paying accrued utility bills. The tenant also contended that the lease terms were unclear and ambiguous regarding rent payment timing and prayed for the contract to be construed in favor of the tenant under the contra proferentem rule. The tenant concluded by arguing that the landlord was not entitled to the orders sought and prayed for costs.

30. In view of the above, the following issues arise for determination:-

C. List Of Issues forDetermination 31. Whether the tribunal has jurisdiction over the dispute?

32. Whether the termination notice issued by the Landlord is valid and in compliance with the provisions of the tenancy agreement and the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act?

33. Whether the Tenant has breached the terms of the lease agreement by failing to pay rent?

34. Whether the Landlord is entitled to the reliefs sought in its Application dated 24th March 2024?

35. Whether the Tenant is entitled to the reliefs sought in its Application dated 3rd June 2024, including utility bill refunds and an injunction.

36. Who shall bear the Costs of the Applications?

D. Analysis And Findings 37. This tribunal must first satisfy itself of having the requisite jurisdiction to entertain the matter before delving to determine the suit in its entirety. The Landlord asserts that the tenancy is a controlled tenancy under the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, and thus the tribunal has jurisdiction to hear and determine the dispute. The Tenant does not contest the tribunal’s jurisdiction.

38. The parties presented a lease agreement governing the tenancy, which contained a term that the lease was to be for 5 years. It did not contain a provision on termination otherwise than for breach of contract. Having considered the nature of the tenancy and the facts presented, the tribunal finds that it has jurisdiction to hear and determine this matter, as the tenancy comprises a controlled tenancy, which falls under the provisions of the Act.

39. The Landlord issued a notice to terminate the tenancy on 21st December 2023, citing the Tenant's failure to pay rent and utilities. The Tenant has contested the notice, arguing that it was invalid due to improper service and the absence of a termination clause in the lease agreement.

40. Under section 4(1) of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, a notice of termination must be served in accordance with the tenancy agreement or as prescribed by the law. The Landlord claims to have served the notice through both personal service via an agent and WhatsApp communication with the Tenant.

41. The Act requires a landlord who wishes to terminate or alter the terms of a controlled tenancy to issue a notice in the prescribed form. Section 4 of the Act provides as follows;Termination of, and alteration of terms and conditions in, controlled tenancy(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 in the prescribed form.

42. Subsection 4 further provides :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;ii.where the terms and conditions of a controlled tenancy provide for a period of notice exceeding two months, that period shall be substituted for the said period of two months after the receipt of the tenancy notice;iii.the parties to the tenancy may agree in writing to any lesser period of notice.The Act provides for the procedure of terminating a controlled tenancy.

43. A reading of the Notice as is confirms compliance with the requirements as above. On service of the termination notice, the Act under Section 4(6) provides as follows:-“A tenancy notice may be given to the receiving party by delivering it to him personally, or to an adult member of his family, or to any other servant residing within or employed in the premises concerned, or to his employer, or by sending it by prepaid registered post to his last known address, and any such notice shall be deemed to have been given on the date on which it was so delivered, or on the date of the postal receipt given by a person receiving the letter from the postal authorities, as the case may be.”

44. The tribunal finds that the notice was properly served on the Tenant, as the Landlord provided evidence of prior communication between the parties that confirms the Tenant’s phone number. Although there was an admitted typographical error in the notice concerning the phone number, this does not invalidate the service, as it was done on both phone and physically.

45. The landlord claimed that the tenant failed to honor the terms of the lease agreement by not paying rent and utility bills, amounting to Kshs. 90,000/-. The tenant, however, denied being in arrears and argued that they made excess payments in the first year of tenancy. The Tribunal finds that the tenant did not provide sufficient evidence to substantiate the claim of excess payment and even admitted in his testimony that he was in arrears at some point during the tenancy. Therefore, the tenant was in breach of the lease agreement for non-payment of rent. As was stated in Samuel Kipkori Ngeno & another v Local Authorities Pension Trust (Registered Trustees) & another [2013] eKLR,A tenant’s first and main obligation is to pay rent as and when it becomes due, for the landlord has the right to an income from his investment.

46. In view of the foregoing, I proceed to order as follows:-

E. Ordersa.The upshot is that the Landlord’s Complaint and Application dated 25th March 2024 are allowed in following terms;b.The tenant shall clear the arrears of Kshs. 11,601/= as at 28th November 2024 in addition to any rent and incidental costs accrued to date no later than close of business on 10th February 2025. c.In default, the Landlord is at liberty to proceed to levy for distress of the rent.d.The Tenant shall additionally hand over vacant possession of the premises to the Landlord on or before 28th February 2024 failure to which the Landlord shall be at liberty to break in and enter with the assistance of OCS Kangete Police Station or any other Police station close by.e.Costs are awarded to the Landlord assessed at Kshs. 40,000/=.f.File is marked as closed.

HON P. KITURMEMBERBUSINESS PREMISES RENT TRIBUNALRuling dated, signed and delivered virtually by Hon P. Kitur this 10th day of February 2025 in the absence of the parties.HON P. KITURMEMBERBUSINESS PREMISES RENT TRIBUNAL