Ram Hospital Limited v Ramji Meghji Gudka Limited [2022] KEBPRT 45 (KLR)

Full Case Text

REPUBLIC OF KENYA

BUSINESS PREMISES RENT TRIBUNAL

VIEW PARK TOWERS 7TH & 8TH FLOOR

TRIBUNAL CASE NO. 78 OF 2021 (KISII)

RAM HOSPITAL LIMITED....................................................APPLICANT/TENANT

VERSUS

RAMJI MEGHJI GUDKA LIMITED.........................RESPONDENT/LANDLORD

RULING

1. By a motion dated 13/9/2021 the tenant moved this Tribunal seeking for restraining orders against the landlord from evicting it from RAM Hospital which is situate on that piece of land known as L.R. NO. Kisii Municipality/Block III/270 pending hearing and determination inter-partes.

2. The tenant is further seeking for a determination that it is the lawful/bonafide tenant of the Respondent and enjoys a controlled tenancy within the meaning and intendment of section 2 of Cap. 301 which can only be terminated in accordance with the provisions of Section 4(2) of the said Act.

3. The application is supported by the affidavit of Dr. Anil Ratilal Tailor sworn on 13th September 2021 and the grounds on the face thereof.

4. It is deposed that in the year 2000, the said Dr. Anil Ratilal Tailor was granted a lease of the suit premises. At the material time, he was trading as RAM Hospital.

5. In the year 2011, the said Dr. Anil Ratilal Tailor incorporated a company known as Ram Hospital Limited which assumed the tenancy in his place. The tenancy was oral.

6. It is the tenant’s case that no formal notice to terminate tenancy under Section 4 of Cap. 301, Laws of Kenya has ever been served upon the applicant.

7. On 19th July 2016, the respondent issued notice upon Dr. Anil Ratilal Tailor t/a Ram Hospital Limited which was non-existent in law. Thereafter the landlord filed an application dated 24th February 2017 vide Kisii CM Misc. Civil Application no. 37 of 2017 seeking adoption of the Business premises Rent Tribunal determination issued on 6th October 2016 against Dr. Anil Ratilal Tailor and Ram Hospital Limited.

8. The said proceedings were challenged vide an application dated 1st March 2017 and an order of stay of proceedings was given on 4th July 2018 by the subordinate court and the matter remitted back to this Tribunal for reconsideration.

9. As a result, the landlord appealed vide Kisii H.C. Civil Appeal no. 52 of 2018. Judgment was delivered on 25th March 2021 upholding the ruling of the subordinate court. It is thus the tenant’s contention that the application dated 24th February 2017 stood dismissed with costs.

10. In June 2021, the Respondent went back to Kisii C.M. Miscellaneous Application no. 37 of 2017 seeking adoption of a purported determination by this Tribunal against Dr. Anil Ratilal Tailor who had not been named in the tenancy notice dated 19th July 2016.

11. The applicant contends that the purported illegal eviction of Dr. Anil Ratilal Tailor is in effect unlawful and required this Tribunal’s intervention since the applicant was a completely different entity.

12. As such any eviction against the applicant hospital would lead to substantial loss which cannot be remedied by any amount of damages as innocent patients will be subjected to suffering, certain death or risk of death and indiginity.

13. The applicant was also likely to suffer loss of business goodwill which cannot be remedied by an award of damages.

14. The applicant contends that it has been paying rent when it falls due with the last payment having been made through M/S Oguttu Mboya Advocates acting for the landlord.

15. The application is opposed through the landlord’s affidavit of Ashwin Ramji Gudka sworn on 1st October 2021 who is the Managing Director of the landlord’s company wherein it is deposed that the applicant’s case is founded on “conscious and deliberate falsehoods”.

16. The tenancy agreement over the suit property was lawfully entered into with Dr. Anil Ratilal Tailor and not otherwise and the “importation” of the tenant/applicant into the premises was at the instance of the said Dr. Anil Ratilal Tailor.

17. Although the said Dr. Anil was obligated to pay rent, he failed and/or neglected to do so for the entire 2014 and 2015 amounting to Kshs.24 million. Discussions were held and Dr. Anil undertook to pay the accumulated rent arrears by 2016 by end of which they were to move out of the suit premises.

18. The tenant did not oblige and rent continued to accumulate to Kshs.37 million as a result of which the landlord filed Kisii HCCC No. 7 of 2017 wherein Judgment was rendered on 14th November 2018 as per annexture ‘ARG-2’.

19. A notice of termination of tenancy was also served upon Dr. Anil Ratital Tailor and an affidavit of service drawn which are respectively marked ‘ARG-3(a) & (b)’. There was no opposition to the notice as a result of which a decision was made by this Tribunal confirming that the notice had taken effect.

20. The Tribunal’s decision is annexed as ‘ARG-4’ as a result of which the matter was litigated vide Kisii CM Misc. Civil Application No. 37 of 2017 and went up to the High Court which decreed that the ruling of the Chief Magistrate’s court issuing a stay of proceedings on the order of the Tribunal dated 6th October 2016 and returning the matter to the Business Premises Rent Tribunal for inter-partes hearing and determination was set aside as per annexture ‘ARG-7’.

21. According to the landlord, the decision of this Tribunal dated 6th October 2016 remains valid, lawful and enforceable. The same was ratified on 18th June 2021 vide annexture ‘ARG-6’. The tenant moved the subordinate court and obtained a temporary order of stay of implementation of the said orders. The matter was fixed for hearing inter-partes on 11th August 2021. The order is annexture ‘ARG-9’.

22. As such the orders of 13th September 2021, were issued in the face of existing order of stay of eviction and as such was an abuse of court process according to the Respondent. The tenant is accused of being guilty of concealment of material facts which were within its knowledge having obtained similar orders in Kisii CMC Misc. Application No. 37 of 2017.

23. As such the orders obtained herein are no longer tenable according to the landlord as they were issued fraudulently in favour of the tenant.

24. As a result, the tenant had been allowed to withhold rent payments amounting to Kshs. 42 million by using the Tribunal orders as a shield from performance of its statutory obligations. As such, the tenant was guilty of coming to court with unclean hands.

25. The tenant filed an affidavit sworn on 20th November 2021 in response to the replying affidavit filed by the landlord.

26. According to the deponent of the said affidavit (Dr. Anil), he was given the premises in the year 2000 and in 2011 incorporated the tenant company which assumed the tenancy in his place.

27. According to him, there was only one tenant in the premises and he was not such tenant. No formal notice had been issued to terminate the applicant’s tenancy under Section 4 of Cap. 301.

28. As a result, the purported eviction against Dr. Anil on the strength of orders obtained in Kisii CMC Misc Civil No. 37 of 2017 is in effect one intended to be executed against the applicant.

29. It is argued that the Chief Magistrate’s court has no jurisdiction to entertain a complaint relating to the tenancy held by the applicant.

30. Instead, the applicant argues that it is this Tribunal which has jurisdiction to hear the complaint on the unlawful intended eviction.

31. The application was ordered to be canvassed by way of written submissions and both parties complied.

32. I am now required to determine the following issues:-

(a) Whether the tenant is entitled to the reliefs sought in the application dated 13/9/2021.

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

33. I have noted that there is no single rent payment receipt annexed to the affidavits filed by the tenant/applicant herein to confirm that it was indeed the recognized tenant of the landlord.

34. According to the affidavits sworn by Dr. Anil Ratilal Tailor on 13th September 2021 and 20th November 2021, he was the tenant of the landlord in respect of the suit premises between the year 2000 and 2011. In 2011, he incorporated the applicant company which assumed the tenancy. I have not seen any evidence that the said change in tenancy status was with the approval of the landlord.

35. I have also noted that the landlord served a termination notice dated 19th July 2016 upon the said Anil Ratilal Tailor who is a director of the applicant but the same was not opposed as required under section 6 of Cap. 301 and as such the notice took effect on 1st October 2016. The same was subsequently ratified vide Kisii CMC Misc Civil Application No. 37 of 2017 which went up to the High Court and was upheld on 25th March 2021 vide Kisii H.C Civil Appeal no. 52 of 2018.

36. The decree marked ‘ARG-7’ clearly shows that the parties in the said appeal were Ramji Meghji Gudka Limited – vs- Dr. Anil Ratilal Tailor & Ram Hospital Limited. In the present matter, the appellant in the said case is now the Respondent while the 2nd Respondent is now the applicant herein.

37. I have also looked at the application dated 1st March 2017 annexed to the applicant’s supporting affidavit herein sworn on 13th September 2021 and all the parties herein are named therein as participants. It is the said application that went on appeal and a decision thereon rendered in favour of the landlord.

38. In my considered view, the issues before court having been subject matter of previous proceedings between the same parties cannot be the basis of fresh proceedings as the issues are Res-judicata and/or Res-subjudice.

39. I have also seen the judgment in Kisii HCCC No. 7 of 2017 between Ramji Meghji Gudka Limited – vs- Dr. Anil Ratilal Tailor & Ram Hospital Limited wherein judgment was entered for the sum of Kshs.37 million against the defendants jointly and severally in favour of the plaintiff and I am satisfied that the issue of rent arrears owingwas addressed in the said suit.

40. In finding that this matter is Res judicata and/or Res-subjudice, I am guided by the Supreme Court of Kenya decision in the case of John Florence Maritime Services Limited & Another – vs- Cabinet Secretary, transport and infrastructure & 3 Others (2021) eKLR at paragraph 54 where it was held as follows:-

“The doctrine of res judicata, in effect, allows a litigant only one bite at the cherry. It prevents a litigant or persons claiming under the same title, from returning to court to claim further reliefs not claimed in the earlier action. It is a doctrine that serves the cause of order and efficacy in the adjudication process. The doctrine prevents a multiplicity of suits which would ordinarily clog the courts apart from occasioning unnecessary costs to the parties and it ensures that litigation comes to an end and the verdict duly translates into fruits for one party and liability for another conclusively”.

41. In the case of Republic -vs- Paul Kihara Kariuki , Attorney General & 2 Others ex-parte Law society of Kenya (2020) eKLR, the High Court addressed the doctrine of Res-Subjudice by citing with approval, the decision in Kenya National commission on Human Rights – vs- Attorney General Independent Electoral & Boundaries commission & 16 Others (Interested parties) by the Supreme Court of Kenya at paragraph 23 as follows:-

“67. The term ‘subjudice is defined in Black’s law dictionary 9th Edition as “Before the court or judge for determination”.

The purpose of the subjudice rule is to stop the filing of a multiplicity of suits between the same parties or those claiming under them over the same subject matter so as to avoid abuse of court process and diminish the chances of courts with competent jurisdiction issuing conflicting decisions over the same subject matter. This means that when two or more cases are filed between the same parties on the same subject matter before courts with jurisdiction, the matter that is filed later ought to be stayed in order to await the determination to be made in the earlier suit. A party that seeks to invoke the doctrine of res subjudice must therefore establish that there is more than one suit over the same subject matter, that one was instituted before the other, that both suits are pending before courts of competent jurisdiction and lastly, that the suits are between the same parties or their representatives”.

42. I am satisfied that the Respondent has laid before me sufficient materials to bring this suit under the twin doctrines of res-judicata and res-subjudice. It is my firm view that this suit is an outright abuse of court process as submitted by the Respondent.

43. In the circumstances, the final orders that commend to me are as follows:-

(a) The application dated 13/9/2021 and the reference by the tenant of even date are hereby struck out with costs to the Respondent.

(b) The ex-parte orders given herein on 20th September 2021 are hereby discharged and vacated.

It is so ordered.

RULING DATED, SIGNED AND DELIVERED VIRTUALLY THIS 10TH DAY OF MARCH 2022.

HON. GAKUHI CHEGE

VICE CHAIR

BUSINESS PREMISES RENT TRIBUNAL

IN THE PRESENCE OF:

NYAMURONJI FOR THE TENANT

OCHWAL FOR THE LANDLORD.