Premji t/a Pramukh Supplies & 2 others (t/a Shreeji Ceramics) v Maroo [2022] KEBPRT 865 (KLR)

Premji t/a Pramukh Supplies & 2 others (t/a Shreeji Ceramics) v Maroo (Tribunal Case 399 & 400 of 2015 (Consolidated)) [2022] KEBPRT 865 (KLR) (Civ) (20 December 2022) (Ruling)

Neutral citation: [2022] KEBPRT 865 (KLR)

Republic of Kenya

In the Business Premises Rent Tribunal

Civil

Tribunal Case 399 & 400 of 2015 (Consolidated)

Andrew Muma, Vice Chair

December 20, 2022

Between

Pabari Harikrishna Premji t/a Pramukh Supplies

1st Tenant

Hitesh Manughai & another

2nd Tenant

t/a Shreeji Ceramics

and

Velji Khimji Maroo

Respondent

Ruling

A. Parties and their representatives 1. The tenants/ applicants, Pabari Harikrishna Premji t/a Pramukh Supplies and Hitesh Manubhai & Another t/a Shreeji Ceramic rented space on LR no 209/4583 for the business (hereinafter referred to as the ‘tenants’)

2. Learned counsel S K Opiyo & Co Advocates represents the tenants/applicants in this reference. skandere@gmail.com

3. The respondent Velji Khimji Maroo is the landlord of the suit premises on LR no 209/4583 rented out to the tenants (hereinafter referred to as the ‘landlord’).

4. The firm of Kithinji Thuranira & Co Advocates is on record for the respondent/landlord. kithuranira@gmail.com

B. The dispute background 5. The genesis of the matter is that on April 24, 2015, the landlord served the tenant/applicant with a notice, seeking to increase rent from the monthly sum of kshs 50,000 to kshs 120,000 for Pramukh Supplies and from kshs 70,000 to kshs 120,000 for Shreeji Ceramics. The tenants protested the proposed rent increment by filing a “reference by tenant” to this tribunal on June 25, 2015.

6. Before the matter proceeded to hearing, both parties filed separate valuation reports, with their respective experts giving opinion on what ought to be the reasonable rent for the premises. The landlord engaged Premier Valuers Limited whose report was received and filed by the tribunal on November 24, 2015. The tenants’ valuer, Teja S Kundhi, filed their report on March 1, 2016.

7. Given the wide discrepancy in the valuations, the tribunal ordered the two valuers to visit the premises together and take joint measurement of the lettable areas in respect of the comparables in the independent reports and prepare a joint valuation report. The joint valuation report was then prepared under the auspices of Premier Valuers Limited and was filed with the tribunal on July 12, 2016.

8. In his judgement rendered on November 14, 2017, Hon Mbichi Mboroki (hereinafter referred to as “the chairman”) considered the valuation reports of the parties on record and on determination, dismissed the tenants’ references and ordered the increment of rent in accordance to the landlord’s notices to the tenants effective from the date of issuance of the notices.

9. It is against this decision that the tenants appealed at the Environment & Land Court Case no 16 & 17 of 2019 on grounds that the chairman failed to consider the joint valuation report in arriving at this decision. Upon hearing and final determination, the court ordered that the two files be returned to this tribunal for the sole purpose of determining the rent payable based on the joint valuation report dated July 12 2016, and I therefore proceed to do so.

C.Consequently on August 9, 2022, this tribunal delivered a ruling determining the rent payable based on the joint valuation report undertaken by the valuers of all parties. It is against this ruling that an application has been brought for setting aside and review error apparent on the face of the record.

D. Issue for determination 10. The issue raised for determination before this tribunal is whether the space occupied by the tenant is 544 sq ft or 272 sq ft for purposes of computing rent arrears.

E. Analysis and determination 11. At the outset, this tribunal refers to the landlord’s Notice of Preliminary Objection in which the Landlord claimed inter alia, that the 1st tenant’s application dated May 19 2022 failed to meet the criteria for review of orders established under order 45 of the Civil Procedure Rules.

12. Order 45(1) of the Civil Procedure Rules stipulates as follows:Any person considering himself aggrieved—a)by a decree or order from which an appeal is allowed, but from which no appeal has been preferred; orb)by a decree or order from which no appeal is hereby allowed, and who from the discovery of new and important matter or evidence which, after the exercise of due diligence, was not within his knowledge or could not be produced by him at the time when the decree was passed or the order made, or on account of some mistake or error apparent on the face of the record, or for any other sufficient reason, desires to obtain a review of the decree or order, may apply for a review of judgment to the court which passed the decree or made the order without unreasonable delay.

13. Before analysing the above statutory provision, this tribunal recognises that section 12(4) of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act confers jurisdiction upon it to investigate any complaint relating to a controlled tenancy made by the landlord or the tenant, and may make such order thereon as it deems fit. Therefore, this tribunal is empowered to determine whether or not to grant the application for review of the orders meted out in the tribunal ruling dated August 9, 2021.

14. This tribunal reiterates the first requirement to be proved in order to grant an application for review under order 45 of the Civil Procedure Rules, namely, that the applicant must demonstrate that they discovered new evidence which after exercising due diligence, was not within their knowledge or could not be produced at the time when the order was made. In this dispute, the 1st tenant claimed in his application that he discovered that the lettable area which was used for valuation in assessing the rent payable included a portion of the suit premises which had been earlier surrendered during the pendency of proceedings before this tribunal. In light of this, this tribunal is satisfied that the 1st tenant has satisfied the first requirement.

15. Concerning the second requirement for an application for review to be granted, this tribunal must consider whether there was any mistake or error apparent on the face of the record in light of the ruling delivered on August 9, 2021. At paragraph 21 of the ruling, this tribunal ordered that the 1st tenant pay rent amounting to kshs 93,743. 70 per month, which amount was calculated based on the total rented space illustrated below:Ground Floor: 548. 25 Square Feet x 114. 29= 62,659. 50Mezzanine: 544. 00 Square Feet x 57. 14= 31,084. 16Rent Payable kshs 93,743. 70 per month (exclusive of VAT):

16. This tribunal recognises that the assessment of rent depicted above was based on an erroneous value of the lettable area occupied by the 1st tenant. I make reference to the letter dated December 16, 2021 by Premier Valuers Limited, annexed to the Thuranira Affidavit para 6, the registered and practicing valuers retained by the 1st tenant and landlord jointly. The said company conducted a valuation of the premises and confirmed that the 1st tenant initially occupied two stores (stores no 11 and 16) on the first floor of the rented premises. The said valuers confirmed that one of the two stores (store no 16) was surrendered thus the actual lettable area that the 1st tenant occupies measures 272 square feet and not 544 square feet. In addition, the tenants letter dated September 26, 2018 also annexed to the Thuranira affidavit from confirms they relinquished the premises on October 31, 2018. As such, I find that the erroneous value of the lettable area constitutes a mistake or error apparent on the face of the record within the meaning of order 45 of the Civil Procedure Rules.

17. From the foregoing, I find that the 1st tenant has sufficiently met the requirements under order 45 of theCivil Procedure Rules. Consequently, this tribunal dismisses the PO and allows the application as follows.

F. Orders 18. The application dated May 19, 2022 is considered and allowed as follows:(a)Therefore, I review my orders so that Mezzanine 544 square feet will apply until October 31, 2018. Thereafter, parties to apply the rent of kshs 57. 14 for the 272 square feet to date.(b)Regarding the joint interest earning account, monies deposited to be released to the landlord.(c)Parties to reconcile accounts as to balance due to landlord in the next 14 days.(d)Tenant to offset the same on or before January 30, 2023. In default landlord can commence distress proceedings.(e)Landlord shall have costs.

HON A MUMAVICE CHAIRBUSINESS PREMISES RENT TRIBUNALRULING DATED, SIGNED AND DELIVERED VIRTUALLY BY HON A. MUMA THIS 20TH DAY OF DECEMBER 2022 IN THE PRESENCE OF KITHINJI FOR THE LANDLORD. N/A FOR THE TENANT.HON A MUMAVICE CHAIRBUSINESS PREMISES RENT TRIBUNAL