Swift Current Enteprises Ltd v Njoroge & another [2022] KEBPRT 227 (KLR)

Swift Current Enteprises Ltd v Njoroge & another (Tribunal Case E704 of 2021) [2022] KEBPRT 227 (KLR) (Civ) (10 June 2022) (Ruling)

Neutral citation: [2022] KEBPRT 227 (KLR)

Republic of Kenya

In the Business Premises Rent Tribunal

Civil

Tribunal Case E704 of 2021

Gakuhi Chege, Vice Chair

June 10, 2022

Between

Swift Current Enteprises Ltd

Applicant

and

Dorcus Ndugi Njoroge

1st Respondent

Icon Auctioneers

2nd Respondent

Ruling

////ARGUMENTS 1. Through a motion dated November 22, 2021, the tenant moved this tribunal seeking for an order of injunction against the respondents to restrain them from attaching, offering for sale by public auction or purporting to sell by public auction the proclaimed goods or interfering with its proprietary interest thereof.

2. The application is supported by the affidavit of Nicholas Kioko who is a director of the tenant sworn on even date and the grounds set out on the face thereof.

3. Interim orders were issued on November 24, 2022 pending hearing inter-partes.

4. The genesis of the dispute is the proclamation of attachment dated August 24, 2021 issued by the 2nd respondent to the tenant in recovery of rent arrears of Kshs 6,666,000/- and auctioneers fees in the sum of Kshs 1,840,000/-.

5. The tenant blames the arrears on the impact of Covid-19 pandemic which affected its business.

6. The application is opposed through a notice of preliminary objection dated November 30, 2021 and a replying affidavit of the 1st respondent sworn on the same date. The preliminary objection is predicated upon lack of jurisdiction on the part of the Tribunal to issue orders in the nature of injunction and the suit being an abuse of court process.

7. It is the 1st respondent’s case that the tenant concealed material particulars with the aim of hoodwinking this court to get underserved orders.

8. The tenant is alleged to have been in rent arrears of Kshs 5,016,000/- as per statement of rent account marked “D3’ which the tenant admitted through various correspondences marked D-5 (a) – (e ) annexed to the replying affidavit.

9. The 1st respondent has annexed a copy of the lease agreement marked ‘DN2’ which provides inter-alia that the landlord has a right to levy distress on the tenant’s goods interalia.

10. After the proclamation by 2nd respondent, the tenant wrote a letter dated August 28, 2021 seeking a meeting with it for purposes of negotiating a settlement on the accrued rent arrears. The letter is marked ‘D8’. On September 6, 2021, the tenant once again admitted being in rent arrears and proposed on settlement. The letter is marked as annexure ‘D10’.

11. The tenant despite the foregoing filed Milimani CMCC No E10760 of 2021 to unjustly stop rent recovery process even as it continued to negotiate settlement of the rent arrears.

12. On October 6, 2021, the tenant was directed in the said case to pay monthly rent as and when it fell due during the pendency of the case and in default, the Landlord was allowed to distress for the same. The order is annexed as ‘D11’.

13. The suit was finally struck out with costs on November 22, 2021 on the basis of a preliminary objection challenging the juristic capacity of Swift Current Enterprises to sue. The order is marked ‘D12’.

14. It is after the said order that the tenant filed the instant proceedings in bad faith while concealing all the foregoing facts.

15. The 1st respondent contends that the tenant did not come to this court with clean hands when it obtained the orders of November 24, 2021 which are oppressive to the landlord’s right to recovery of rent arrears owed. The same ought to be vacated according to the 1st respondent.

16. The tenant filed a response to the preliminary objection through grounds of opposition dated January 13, 2022. It is to be noted that the tenant did not file any supplementary affidavit to controvert the contents of the 1st respondent’s replying affidavit.

17. The 1st respondent filed an application dated February 12, 2022 seeking that the tenant be ordered to deposit Kshs 6,666,000/- in the tribunal pending hearing of the suit.

18. She further seeks that in default of deposit of the rent arrears, the tenant’s tenancy be terminated and it be evicted from L R No Nairobi Block 83/14/539 commonly known as Visa place, Buruburu.

19. She is also seeking to be allowed to levy distress for rent arrears against the tenant with assistance of OCS Buruburu Police Station. The 1st respondent reiterates in the supporting affidavit to the application the contents of her replying affidavit discussed above. I have not come across any replying affidavit to the application and the same therefore remains unopposed.

20. The two applications were directed to be disposed of by way of written submissions and both parties complied. I shall advert to the submissions while addressing the issues for determination.

21. Going by the pleadings, the issues for determination are:-a.Whether the tenant is entitled to the reliefs sought in the application dated November 22, 2021 and the complaint of even date.b.Whether the 1st respondent is entitled to the orders sought in the notice of preliminary objection and the application dated February 12, 2022. c.Who is liable to pay costs of the suit?

22. The tenant came to this court seeking equitable remedy of injunction. It is trite law that he who comes to equity must come with clean hands and must bring himself within the principles laid down in the case of Giella vs Cassman Brown & sons Limited.

23. The tenant has not denied that at the time it came to this court, it was in arrears of Kshs 6,666,000/- having admitted the same in various correspondences annexed to the replying affidavit. It is trite law that before a litigant can be granted an order of injunction, he must demonstrate that he has fulfilled all obligations required to be fulfilled by him (see the case of Kyangavo vs Kenya Commercial Bank Ltd & Another (2004) eKLR at page 13/14).

24. In the case of Samuel Kipkori Ngeno & Another – vs- Local Authorities Pension Trust (Registered Trustees) & Another (2013) eKLR at paragraphs 9 & 12, the superior court had the following to say:-“9. A tenant’s first and main obligation is to pay rent as and when it becomes due for the landlord has the right to an income from his investment. Why would a tenant allow himself to fall into such huge arrears of rent”.“12. The temporary injunction sought in the present application is an equitable remedy at the court’s discretion. He who comes to equity must come with clean hands. A tenant who is in huge arrears of rent is underserving of the court’s discretion. The court cannot be the refuge of a tenant who fails to meet his principal obligation of paying rent as and when it becomes due”.

25. In the instant case, the tenant is seeking to be protected by this tribunal from performing its obligation to pay rent. No court of equity would contenance such a situation as the landlord is equally entitled to equity.

26. I agree with the landlord’s counsel that the distress for rent sought to be levied by the landlord through the 2nd respondent was lawful. I am fortified in that regard by the decision in the case of Kakamega Royal Gardens Hospital vs Ebrahim Omenyi Ambwera & Another (2018) eKLR cited by the landlord.

27. In the premises even without discussing the other issues raised by the landlord, I find that the landlord was entitled under section 3(1) of the Distress for Rent Act to levy distress for the amount in arrears.

28. The tenant came to this court and failed to disclose that it had lost another case before the Milimani Chief Magistrate’s court. This amounted to abuse of court process in line with the decision in the case of Gabriel Kariuki Gitonga & 2 Others vs Redken Wells Limited & 11 Others (2021) eKLR wherein, the superior court held as much. The net effect is that the interim orders ought to be discharged or set aside as sought by the 1st respondent.

29. The right to re-entry is provided under the lease agreement entered between the two parties and this being their contract, this honourable court’s duty is merely to interpret and not to alter the terms of the contract. As such the application by the landlord to re-enter and take possession of the suit premises being contractual is properly sought in line with the decision in Jiwaji & Others vs Jiwaji & Another (1968) EA 547 at page 554.

30. The complaint filed by the tenant raises the same issues as those raised in the applications under consideration and I am entitled to determine it together with the applications under section 12 (4) of cap 301, Laws of Kenya without requiring a hearing by way of viva voce evidence.

31. In conclusion, I make the following final orders:-i.The tenant’s application dated November 22, 2021 is dismissed with costs together with the complaint of even date.ii.The landlord’s/1st respondent’s application dated February 12, 2022 is allowed with costs.iii.The interim orders given on November 24, 2021 are hereby discharged and/or vacated forthwith.iv.The landlord is granted Kshs 50,000/- as costs of the applications and the reference.It is so ordered.

RULING DATED, SIGNED AND DELIVERED THIS 10TH DAY OF JUNE 2022. HON GAKUHI CHEGEVICE CHAIRBUSINESS PREMISES RENT TRIBUNALIn the presence of:Gachau Kariuki for the landlordNo appearance for the tenant