Shem Thomason Machoka & Gusii Tools & Hardware Ltd v Gilta Investment Limited & Oscar Odongo [2021] KEELC 4510 (KLR) | Landlord Tenant Disputes | Esheria

Shem Thomason Machoka & Gusii Tools & Hardware Ltd v Gilta Investment Limited & Oscar Odongo [2021] KEELC 4510 (KLR)

Full Case Text

REPUBLIC OF KENYA

IN THE ENVIRONMENT AND LAND COURT AT KISII

ELC APPEAL NO. 12 OF 2018

SHEM THOMASON MACHOKA...................................... 1ST APPELLANT

GUSII TOOLS & HARDWARE LTD................................. 2ND APPELLANT

VERSUS

GILTA INVESTMENT LIMITED.....................................1ST RESPONDENT

OSCAR ODONGO............................................................. 2ND RESPONDENT

(Being an appeal from the Ruling and decision of Hon. John M. Njoroge CM delivered on 22nd March 2017 in Kisii CMCC Misc. Appl. No. 157 of 2016)

JUDGMENT

INTRODUCTION

1. The brief facts of the matter before the trail court are as follows; the Appellants herein were carrying on business on a portion of premises situate on LR No. Kisii Municipality /Block III/119 which had been leased out by the 1st Respondent. The 1st Respondent claimed that it was constrained to issue the Appellants with a Notice to Terminate Tenancy due to their persistent delay in paying rent and their failure to pay rent for more than two months.

2. The Appellants did not file any reference or object to the Notice to Terminate Tenancy and as a result, the Business Premises Rent Tribunal (hereinafter “the Tribunal”) confirmed the cessation of the Tenancy on 11th October 2016. The 1st Respondent then filed Miscellaneous Application No. 157 of 2016 seeking, inter alia, the adoption of the determination of the Tribunal by the trial court and the application was allowed on 13th October 2016.

3. Soon thereafter, the Appellants moved the court vide a Notice of Motion dated 21st October 2016 seeking to set aside and review the orders of the trial court. They claimed that they had been running their business on the suit premises since 1973 and they had not entered into any tenancy agreement with the 1st Respondent. The Appellants denied being in default of any implied terms of tenancy or in payment of their monthly rents as alleged. They also denied the existence of a determination by the Tribunal capable of adoption as a decree of the court. They claimed that the 2nd Respondent had carried away their belongings without service of the Notice of Termination of Tenancy and they therefore sought the following reliefs against the Respondents;

a. That this matter is certified urgent and prayers 1 and 2 below be granted ex- parte in the first instance;

b. That pending hearing and determination of this Application, there be an order of injunction restraining the Landlord-Gilta Investment Limited, its agents, servants and/or assigns from occupying, letting, sub-letting, leasing, using and/or in any way materially changing the character of the Respondent/Applicants’ tenancy premises at the Applicant/Respondents’ LR No. Kisii Municipality /Block III/119 (the “suit premises”);

c. That Oscar Otieno Odongo t/a Odongo Investment Auctioneers is enjoined hereto as an interested party;

d. That the Applicants/tenants be at liberty to evict the landlord, his agent(s) and/or assigns from LR No. Kisii Municipality/Block III/119 ( the suit premises); and otherwise retake possession of the premises, unconditionally;

e. That the order as per prayer 4 above be executed by Moco Auctioneers who are at liberty to break in to effect execution;

f. That the OCS, Kisii Police Station do supervise and provide security to facilitate execution and/or implementation of the orders as per prayers 4 & 5 above;

g. That the Orders of 13/10/2016 herein for, inter alia, eviction as against the Applicant/tenants be reviewed and set aside; and

h. Costs.

4. In response, Minaz Gilani, one of the 1st Respondent’s directors swore a replying affidavit on 8th November 2016 insisting that the 1st Respondent had a tenancy agreement with the Appellants. He averred that the Appellants had began defaulting on their monthly rent payments, compelling the respondents to levy distress for rent and issue the Notice to Terminate Tenancy. The Respondents paid a sum of Kshs. 80,000/= when a proclamation notice was issued, but did not settle the entire rent arrears. Before the 2nd Respondent could move to attach the proclaimed goods, the Notice to Terminate Tenancy matured and the determination of the Tribunal was duly ratified by the trial court. The Appellants were evicted but retook possession pursuant to interim orders issued by the trial court.

5. Minaz Gilani asserted that the trial court was empowered to adopt the determination of the Tribunal and became functus officio as soon as it had adopted the determination of the Tribunal. The 1st Respondent also filed a Notice of Preliminary Objection and a statement of grounds of opposition contesting the trial court’s jurisdiction to hear the Application.

6. For his part, the 2nd Respondent averred in an affidavit sworn on 8th November 2016 that he had merely executed the orders of the court and in any event the proceedings against him were barred under Section 6 of the Judicature Act.

7. The Application dated 21st October 2016 was canvassed by way of written submissions. The trial court considered the submissions filed by the parties and found that it had no jurisdiction to hear and determine matters relating to landlord-tenant relationships. The court also held that it only had jurisdiction to adopt decisions emanating from the Tribunal and having done so, the court became functus officio.

8. The Appellants, being aggrieved by the foregoing decision of the court, have filed the instant appeal. The grounds of appeal are as follows;

a. That in the face of Order 45 Civil Procedure Rules read with Section 80 Civil Procedure Act the Trial Magistrate erred in both law and fact when he found that his court stood functus officio for purposes of the Appellant’s Application for review;

b. The learned magistrate ought not to have upheld the Respondent’s preliminary objection inter alia, as there was no determination within the meaning, letter and spirit of the Landlord and Tenant (Shops, Hotels and Catering Establishment ) Act especially Section 14 thereof.

PARTIES’ SUBMISSIONS

9. In canvassing the appeal, the Appellant’s counsel, in written submissions, argued that the Respondents purported to evict the Appellant on the strength of a non-existent determination of the Tribunal. That what the Respondents treated as a determination of the tribunal was in fact a letter done by a Rent inspector. He submitted that pursuant to Order 45 of the Civil Procedure Rules, the orders of the trial court issued on 13th October 2016 were open to review. He was emphatic that there was no determination by the Tribunal capable of being adopted by the trial court.

10. The 1st Respondent’s counsel submitted that the Appellants were in chronic and persistent breach of implied terms of the tenancy agreement they had with the Respondent. That the Appellants failed to pay two monthly rents and the 1st Respondent was obliged to issue the Notice to Terminate the Tenancy. When the Appellants failed to object or lodge a Reference, the Notice to Terminate Tenancy materialized. Counsel agreed with the trial court’s position that upon adoption of the determination of the Tribunal, the court became functus officio and divested of jurisdiction to entertain the Appellants’ Application.

11. In defence of the letter dated 11th October 2016 as a determination of the Tribunal, counsel submitted that in the case of Dhirajlal J. Shah & another v Vijay Amritlal Shethia [2018] eKLR the Court of Appeal had recognized the validity of letters either confirming the existence of a reference or none.

12. The 2nd Respondent’s counsel also urged that the jurisdiction of the Court terminated upon the issuance of the Adoption Order. He submitted that the 2nd Respondent is a licensed auctioneer who implemented the orders of the court to evict the Appellants and no suit could be brought against him as per section 6 of the Judicature Act.

ISSUES, ANALYSIS AND DETERMINATION

13. Having analysed all the material placed before this court including the written submissions and the record of appeal, I am of the view that this appeal raises the following issues for determination;

a. Whether the determination adopted by the trial court was a determination of the Business Premises Rent Tribunal as envisaged in section 14 Landlord and Tenant (Shops, Hotels and Catering Establishment) Act (herein after “the Act”); and

b. Whether the trial court erred by failing to review the order of eviction made on 13th October 2016 as provided under Order 45 of the Civil Procedure Rules.

14. I must point out at the outset that the ruling appealed against is a determination by the trial court on the application dated 21st October 2016 and not the Respondents’ Preliminary Objection as indicated in the memorandum of appeal. The trial court considered the Application, the responses and respective arguments of the parties and issued its determination on the Notice of Motion dated 21st October 2016.

15. On the first issue, the Appellants contend that the letter of the Rent Tribunal did not constitute a determination of the Tribunal capable of being adopted by the court as envisioned under Section 14 (1) of theAct which provides as follows;

14 (1)A duly certified copy of any determination or order of a Tribunal may be filed in a competent subordinate court of the first class by any party to the proceedings before such Tribunal or by the Tribunal, and on such copy being filed and notice thereof being served on the Tribunal by the party filing the same such determination or order may, subject to any right of appeal conferred by or under this Act, be enforced as a decree of the court.

16. The impugned letter of Tribunal dated 11th October 2016 which was adopted as an order of the court read as follows:

RE: LANDLORD NOTICE TO TERMINATE TENANCY- SHEM THOMSON MACHOKA AND GUSII TOOLS & HARDWARE LTD

Reference is made to the above matter

We confirm that the notice you issued to your above mentioned tenants under the provisions of CAP 301 of the Landlord and Tenant (Shops, Hotels and Catering Establishment) Act, expired on 1st October 2016 without any reference or objection from the tenants as required under section 6 (1).

They are therefore not covered by the Act and supposed to be evicted forthwith.

Robinson Ntabo

Rent Control Inspector

South Nyanza Region- Kisii

17. The letter reproduced above was not certified as an order or determination of the Tribunal. In the case of Dhirajlal J. Shah & another v Vijay Amritlal Shethia [2018] eKLRwhich was cited by the 1st Respondent, the question for determination before the Court of Appeal was whether a reference had been filed before the Tribunal. From my reading of the authority, I did not find the Court to endorse a letter by the Tribunal as the orders or determination of the Tribunal.

18. I agree with the persuasive authority of Charles Dickens v Walter Achango Oloo Civil Appeal No. 48 of 2015[2015] eKLRthat such a letter did not constitute a determination or order of the Tribunal capable of ratification as a decree of the Court. The court in that matter held;

“9. I find that letter dated 30th October 2014 issued by the Rent Control Inspector was not an order or determination by the Tribunal. It was not certified as such and the same could not be executed by the subordinate court as provided in section 14 of the Act. It was a mere letter from an officer expressing an opinion which was incapable of execution or enforcement.”

19. Similarly, in the case of Serephen Nyasani Menge v Rispah Onsanse Environment and Land  Case Appeal No. 11 Of 2016[2018] eKLR the court held as follows;

“12. The letter of 17th December 2015 from the Tribunal in my view was not a determination of the Tribunal as envisaged under Section 14(1) of the Act.  Section 14(1) of the Act envisages that some proceedings either arising from a complaint or a reference made to the Tribunal has been heard and a determination made by the Tribunal.  It is such a determination which is required to be duly certified and filed in a competent subordinate court.  In the premises, the Tribunal’s letter dated 17th December 2015 was merely an affirmation that the receiving party of the Notice to Terminate the Tenancy had not opposed and/or filed a reference before the Tribunal and hence the Notice had taken effect.”

20. Having answered the first issue in the negative, I now turn to the second issue which is whether the trial court can be faulted for failing to review the order of eviction made on 13th October 2016 as provided under Order 45 of the Civil Procedure Rules. The factors to be considered in determining whether to grant an application for review are set out in Order 45 of the Civil Procedure Rules thus;

45 (1) 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; or

(b) 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.

21. A brief exposition of Order 45 above is found in the case of National Bank of Kenya Limited v Ndungu NjauCivil Appeal No. 211 of 1996 (1997) eKLR where the Court of Appeal held as follows;

“A review may be granted whenever the court considers that it is necessary to correct an apparent error or omission on the part of the court. The error or omission must be self evident and should not require an elaborate argument to be established. It will not be a sufficient ground for review that another Judge could have taken a different view of the matter. Nor can it be a ground for review that the court proceeded on an incorrect exposition of the law and reached an erroneous conclusion of law. Misconstruing a statute or other provision of law cannot be a ground for review.”

22. The basis of the Appellants’ Application for review was the fact that the letter dated 11th October 2016 was not a determination of the Tribunal capable of ratification as a decree of the court. As I have already found, the letter by the Tribunal did not constitute a determination of the Tribunal and the trial court erred in adopting it as such. That said, the application for review did not present a mistake or error apparent on the face of the record or a discovery of new and important matter or evidence which was not within the Appellants’ knowledge or could not be produced at the time when the decree made. The finding by the trial court exhibited an incorrect comprehension of the law and was not a proper ground for review. Allowing the application for review on the grounds presented before it would be tantamount to having the trial court sit on appeal of its own decision which is prohibited in law.

23. I therefore find no merit in the appeal and dismiss it with costs to the Respondents.

Dated, signed and delivered at Kisii this 28th day of January, 2021.

..............................

J.M. ONYANGO

JUDGE