Ngwana v Tsavo Lifestyle Limited [2022] KEBPRT 738 (KLR)

Ngwana v Tsavo Lifestyle Limited (Tribunal Case E123 of 2022) [2022] KEBPRT 738 (KLR) (29 September 2022) (Ruling)

Neutral citation: [2022] KEBPRT 738 (KLR)

Republic of Kenya

In the Business Premises Rent Tribunal

Tribunal Case E123 of 2022

Andrew Muma, Vice Chair

September 29, 2022

Between

Maxwell Ngwana

Tenant

and

Tsavo Lifestyle Limited

Landlord

Ruling

Parties and Their Representative 1. The Tenant/ Applicant rented the suit premises erected at the Rooftop of Coral Bells by Tsavo (Hereinafter referred to as “Tenant)

2. The firm of Allamano & Associates Advocates is on record representing the Tenant. Info@allamanoandassociates.com.

3. The Landlord/Respondent is the owner of all that property known as Coral Bells by Tsavo situate in Thindigua, Kiambu County. (Hereinafter referred to as the “Landlord.”)

4. The firm of MAK& Partners Advocates is on record representing the Landlord herein. mak@makadvocates.com

The Dispute Background 5. On 10th Feb 2022, the Tenant filed a reference to the Tribunal on the grounds that the Landlord maliciously switched off power supply to the premises and continually harass him to pay backdated rent arrears. He further avers that the Landlord has issued him with an illegal eviction notice.

6. The honourable Tribunal certified urgent and orders were granted on 10th Feb 2022 restraining the Landlord from evicting the Tenant from the premises. The tenant was directed to serve the Landlord ahead of the hearing slated for 24th March 2022.

7. On 30th March 2022, the applicant filed an amended notice of motion wherein he sought an interlocutory injunction to restrain the Landlord from evicting him citing the notice to be improper and irregular and the Landlord to be estopped from demanding backdated rent arrears as that was not the agreement they entered into in September 2019.

8. The Tenant filed their submissions dated 7th June 2022 in respect of the application. In response, the Landlord filed their submission dated 1st August 2022.

9. The application coming up for ruling therefore is the Tenant’s application dated 30th March 2022.

Tenants Claim 10. The tenant and one Maxwel Ngwana claims that he entered into an oral agreement with the Landlord in September 2019 wherein the Landlord allowed him to use the space on Coral Bells Tsavo rooftop to run business. In return for the rooftop space, he took part in marketing, advertising and improving lifestyle of the Landlord’s premise and for the benefit of the Landlord’s residential tenants in the building and there was no representation as to any rent that he ought to have paid.

11. However, on 14th Jan 2022, the Landlord’s employees began harassing him and maliciously switched off electricity supply to the premises where he ran a restaurant occasioning him great loss as there were perishable foods and beverages that were spoilt as a result of the switched off electricity supply. The perished food supplies and beverages amounted to Kshs72,450. 00.

12. The Tenant also claims to have suffered financial loss and loss of business as on that particular weekend the CAF Africa Cup of Nations (AFCON) Tournament was being screened on television.

13. The Landlord also demanded payment of Kshs 113,000. 00 being rent arrears for the year 2021. In a bid to resolve the issue, the Tenant requested to be availed with a written lease for the premises. The Landlord did not respond to the issue. As a further act of goodwill, the Tenant paid Kshs8,000. 00 as rent for the month of January 2022, awaiting a written lease agreement for the suit premises.

14. However, on 18th Jan 2022, the Landlord’s employees disconnected water supply to the premises forcing the Tenant to incur huge expenses to source for water to run the business. The Landlord then served him with a one-month eviction notice dated 31st Jan 2022.

Landlord’s Claim 15. The Landlord does not contend that he entered into an oral agreement with the Tenant but indicates that the terms of the agreement were that the Tenant was to pay Kshs 8,000. 00 per month as rent for the demised premises.

16. He further indicates that he did not generate invoices for the year 2021 as he waived the rent as a result of the ravaging effects of Covid-19 Pandemic and as such, the Tenant should pay rent for the year 2021 and 2022.

17. The Tenant has been in continued arrears which has resulted to switching off the power by KPLC.

18. That seeing the situation could not be remedied, he sent a vacation notice to the Tenant so that he could reclaim his premises as this is one of the rights of the lessor.

19. He further indicates that the Tenant has not attained the threshold for grant of interlocutory injunction.

Jurisdiction 20. The jurisdiction of the Honourable Tribunal is not disputed by the parties.

List of Issues for Determination 21. The parties raised certain issues for determination and the Tribunal shall proceed to distill the issues discussed by the parties as below:a.Whether the Tenant has attained the threshold for grant of interlocutory injunction sought in the Application dated 30th March 2022. b.Whether the eviction notice dated 31st Jan 2022 is valid

Analysis and Findings Whether the Tenant has attained the threshold for grant of interlocutory injunction sought in the application dated 30th March 2022 22. The celebrated hallmark case of Giella v Cassman Brown, laid down the three-pronged conditions for grant of an Interlocutory relief. Here, the applicant must demonstrate that:1. They have a prima facie case with a probability of success2. They stand to suffer irreparable harm if the injunction is not granted.3. Where the court is in doubt, the application shall be decided on a balance of convenience.

i. Prima facie case with a probability of success 23. In defining a prima facie case, Mrao Ltd Vs First American Bank of Kenya Ltd and 2 others (2003) KLR posits that:‘‘In civil cases, a prima facie case is a case in which on the material presented to the court, a tribunal properly directing itself will conclude that there exists a right which has apparently been infringed by the opposite party….it is more than an arguable case… the evidence must show an infringement of a right’’

24. In this instant case, the Tenant contends that the actions of the Respondents have created an unconducive environment for business and have continually occasioned him financial loss as the Tenant has enumerated the Loss suffered once the Respondent’s employees switched off electricity supply to the premises., Further, he has had to incur expenses to procure water to continue running his business.

25. The Tenant contends having honoured his end of bargain by improving Lifestyle at CoraL Bells- Tsavo. Further, he has demonstrated goodwill by seeking to engage the Landlord to peacefully resolve the matter.Further, relying on the concept of promissory estoppel, the Tenant contends that the Landlord is estopped, by virtue of his conduct from demanding payment of back dated rent arrears.

26. From the documents filed, there is no evidence of payment of rent from the year 2019 as the Landlord claims that rent was due save for the year 2020 when the rent was waived as a result of Covid-19 pandemic. The Landlord has neither annexed the statement of accounts neither has he annexed invoices to show the accrued rent. However, it is worth noting that the Tenant is in arrears for water bill as evidenced by the statement of water payment accounts annexed herein.

27. Having evaluated the evidence presented before me, I find that the applicant has presented a prima facie case with a probability of success.

ii. The Applicant stands to suffer irreparable harm if the injunction is not granted 28. The Tenant claims to have suffered financial loss amounting to Kshs72,450. 00 as a result of electricity supply being switched off in his premises. Further, he continues to incur high expenses to source for water to run his business.

29. Further, the tenant claims to have suffered financial loss and loss of business as on that particular weekend the CAF Africa Cup of Nations (AFCON) Tournament was being screened on television. The nature of loss as especially the loss of business may not be quantified in monetary terms and as such, the tenant may not be adequately compensated where the interlocutory injunctions are not granted.

30. Interestingly, the Landlord has not demonstrated the prejudice that he stands to suffer if the interlocutory injunctions are granted as sought by the Tenant. In my considered view, the Tenants stands to suffer irreparable harm should the interlocutory injunction be denied.

iii. Whether the eviction notice dated 31st Jan 2022 is valid 31. Section 4(4) of the Landlord and Tenant (Shops, Hotels And Catering Establishments) provides that: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:

32. The termination notice dated 31st Jan 2022 provided a one month notice for the Tenant to vacate the premises. This is one of the grounds that the Tenant contends citing the notice to be irregular.

33. Further, Section 4(5) of the Act provides thatA 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, whether or not he agrees with the notice.

34. In the notice, the Tenant has not been afforded an opportunity to respond to the notice as required by law. Though it discloses that the reason for the termination is continued default in payment of rent arrears by the Tenant. This issue is however, contested by the Tenant claiming that there is no rent payable in respect to the demised premises.

35. It is my considered view that the notice is defective and therefore invalid for failure to adhere to the stipulated timelines.

Orders 36. For the reasons given above I order as follows that;a.That Application Dated 30th March 2022 is allowed in the following terms;b.Reasons advanced for termination are not sufficient tenant to continue paying rent @ 8,000/- per month from January to date as per orders of 24 March 2022 and every subsequent month thereafter in default landlord at liberty to distress.c.Landlord at liberty to file a reference on rent increament if need be.d.Tenants reference settled on similar terms.e.No orders as to costs.

HON. A. MUMAVICE CHAIRBUSINESS PREMISES RENT TRIBUNALRuling dated, signed and delivered virtually by Hon A. Muma (Vice Chair) this 29th day of September 2022 in the presence of Boma holding brief forOngindi for theTenant andMiss Ronish for theLandlord.HON. A. MUMAVICE CHAIRBUSINESS PREMISES RENT TRIBUNAL4