Sagal Investments Limited v Gulf African Bank Limited & 2 others [2023] KEHC 27456 (KLR)

Sagal Investments Limited v Gulf African Bank Limited & 2 others (Commercial Appeal 006 of 2022) [2023] KEHC 27456 (KLR) (Commercial and Tax) (9 October 2023) (Ruling)

Neutral citation: [2023] KEHC 27456 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Commercial Courts)

Commercial and Tax

Commercial Appeal 006 of 2022

DO Chepkwony, J

October 9, 2023

Between

Sagal Investments Limited

Appellant

and

Gulf African Bank Limited

1st Respondent

Garam Auctioneer

2nd Respondent

Abdi Yusuf

3rd Respondent

Ruling

1. Before this court for determination is the Notice of Motion Application dated 23rd March, 2022 in which the Applicant/Appellant is seeking the following orders:a.Spent.b.Spent.c.That the Honourable Court be pleased to issue a temporary injunction restraining the 1st and 3rd Respondents their agents, employees, advocates, auctioneers or any person acting on their behalf from transferring to the 3rd Respondent, YUSUF ABDI, or any other persons or entities the property known as L.R. No. 209/181158 (IR No. 127286) Diamond Park Estate South B pending the hearing and determination of the Appeal.d.That the Honourable court be pleased to vacate, set aside and/or annul the sale and/or all the transcations arising from the sale of as L.R. No. 209/181158 (IR No. 127286) Diamond Park Estate South B and revert ownership of the said parcel of land to the Appellant herein.e.That the costs incidental to the application be provided.

2. The Application is based on the grounds set out on its face and reiterated in the Supporting Affidavit of Abdullahi Issa Ali sworn on 23rd March, 2022. The Applicant “the Company” holds that it is the registered owner of the subject property and that it filed an application dated 16th July, 2021 in the trial court seeking injunctive orders against the 1st Respondent “the Bank”, and the 2nd Respondent “the Auctioneers” to restrain this from transferring the property to the 3rd Respondent “the Purchaser” pending the hearing and determination of the suit. The Company states that the Bank filed a response therein and held that the application was defective for the reason that the same had been determined by the High court and the Court of Appeal. The Company holds that the trial court agreed with the Bank and dismissed the application dated 16th July, 2022 on the basis of it being res judicata and subjudice.

3. The Company states that it was aggrieved by said decision and it filed the present appeal alongside the present application which is due for consideration. According to the Company, the property was sold by the Auctioneers to the purchaser in breach of the Auctioneer’s Rules. It therefore seeks to have the public auction set aside.

4. The Company contends that the transfer of the property to the purchaser should be restrained as he has an arguable appeal with a high chance of success and that it stands to suffer irreparable loss which cannot be compensated by an award of damages.

5. In response, the Bank filed Replying Affidavit sworn by Lawi Sato on 8th March, 2022 wherein it is averred that the application is fatally defective as the issues raised therein have been determined in other cases filed by the Applicant/Appellant in both the High Court and Court of Appeal.

6. In a Further Affidavit sworn by Abdi Hassan Abdi on 6th October, 2022 and filed by the Company, it argues that there is no appeal or any former Judgment which was final with regard to the appeal before this court. It states that there are no similarities between the subject matter and the cause of action in this matter and those other cases.

7. The Company holds that the present application was filed after it was aggrieved by the decision of the trial court and it is seeking to set aside the sale by public auction on Land Reference No.L.R. No.209/181158 (I.R. No.127286) Diamond Park Estate South B while the application dated 16th July, 2021 was challenging the statutory power of sale and therefore the averments in the Replying Affidavit are misleading the court.

8. On 26th July, 2022, the court directed the parties to file written submissions in respect to the application. The Company filed its submissions dated 11th October, 2022 and the Bank together with the Auctioneers filed their Submissions dated 7th October, 2022 and the supplementary submissions dated 28th October, 2022, in support of their respective positions, which submissions will be considered in the determination of the application.

Analysis and Determination 9. Having read through the respective affidavits sworn by the parties alongside the submissions they have filed to argue their respective positions in the matter, this Court finds the main issues for consideration being:-a.Whether the application is overtaken by events,b.Whether the application is res judicata, and;c.Whether the application warrants the orders sought.

10. On the issue of whether the application is overtaken by events in the supplementary submissions, the Respondent’s contend that the subject property has already been sold, the full purchase price received and the completion documents released to that they no longer have an interest in the said properties. In view of this, the orders sought are incapable of implementation and the Respondents thus urge that the court to dismisses the application dated 23rd March, 2022.

11. Upon reading through the Application, the court notes that the Applicant was aware of the sale of the properties by public auction and is now seeking to have the said sale annulled or set aside and for the transfer of the suit property to be restrained. In that regard the application cannot be said to have been overtaken by events.

12. The next issue is whether the application is res judicata and on this, the court notes that the Application dated 23rd March, 2022 seeks the same orders as the application dated 16th July, 2021 which was dismissed by Hon D.W. Mburu, Principal Magistrate on 28th January, 2022 on the basis that it was res judicata since there were similar suits filed before the High Court and the Court of Appeal. Being aggrieved by the ruling, the Applicant/Appellant filed the present Appeal and the application herein.

13. A reading of the pleadings confirm to the court that the Applicant has filed multiple suits against the Respondents in both the High Court and the Court of Appeal being: -a.Nairobi HCCC NO. E228 of 2019, Beyruha Academy & Sagal Investment Limited versus Gulf Africa Bank Limited & Leakey Auctioneers Limited.b.Nairobi HCCC NO. E211 of 2020, Sagal Investment Limited & Beyruha Academy versus Gulf Africa Bank Limited & Leakey Auctioneers Limited.c.Nairobi HCCC NO. E008 of 202, Sagal Investment Limited & Beyruha Academy versus Gulf Africa Bank Limited & Leakey Auctioneers Limited.d.Nairobi HCCC NO. E613 of 2021, consolidated with Nairobi HCCC NO. E614 of 2021Beyruha Academy & Sagal Investment Limited versus Gulf Africa Bank Limited & Garam Investment Auctioneers.e.Nairobi HCCC NO. E9776 of 2021, Sagal Investment Limited versus Gulf Africa Bank Limited & Garam Investment Auctioneers.

14. The Applicant then filed this present application which conduct is against the provisions of Section 7 of the Civil Procedure Act that states as follows:-“No Court shall try any suit or issue in which the matter directly and substantially in issue has been directly and substantially in issue in a former suit between the same parties, or between parties under whom they or any of them claim, litigating under the same title, in a Court competent to try such subsequent suit or the suit in which such issue has been subsequently raised, and has been heard and finally decided by such Court.”

15. On the issue of res judicata the Court of Appeal in the case of The Independent Electoral and Boundaries Commission –vs- Maina Kiai & 5 Others, [2017] eKLR), had this to say:-[F] or the bar of res judicata to be effectively raised and upheld on account of a former suit, the following elements must be satisfied, as they are rendered not in disjunctive but conjunctive terms;a)The suit or issue was directly and substantially in issue in the former suit.b)That former suit was between the same parties or parties under whom they or any of them claim.c)Those parties were litigating under the same title.d)The issue was heard and finally determined in the former suit.e)The court that formerly heard and determined the issue was competent to try the subsequent suit or the suit in which the issue is raised.

16. In this case, it is evident that the Applicant has filed multiple suits and applications over the same subject matter against the same parties and this offends the doctrine of res judicata. Kuloba J., in the case of Njangu –vs- Wambugu & Another, Nairobi HCCC No.2340 of 1991 (unreported), held that:-‘If parties were allowed to go on litigating forever over the same issue with the same opponent before courts of competent jurisdiction merely because he gives his case some cosmetic face lift on every occasion he comes to court, then I do not see the use of the doctrine of res judicata...”

17. Having found as aforesaid, the Notice of Motion application dated 23rd March, 2022 is found to be against the principles of res judicata hence there is no need to address the orders sought.

18. The Application is therefore dismissed with costs to the Respondents.

It is so ordered.

RULING DELIVERED, DATED AND SIGNED AT KIAMBU THIS 9TH DAY OF OCTOBER , 2023. D. O. CHEPKWONYJUDGEIn the presence of:Mr. Adere holding brief for Ogunda for 1st and 2nd RespondentCourt Assistant - Martin