The Good Earch Group v Kenya Railways Corporation [2022] KEBPRT 76 (KLR)

REPUBLIC OF KENYA

BUSINESS PREMISES RENT TRIBUNAL

TRIBUNAL CASE NO E477 OF 2021 (NAIROBI)

THE GOOD EARCH GROUP………………….………………..TENANT/APPLICANT

VERSUS

KENYA RAILWAYS CORPORATION….……….……….LANDLORD/RESPONDENT

RULING

1. The Landlord’s notice of preliminary objection dated 29th October 2021 is majorly premised on the ground that;

“This honourable Tribunal lacks the requisite jurisdiction to entertain the current application and any subsequent suit in this matter under Section 12 of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act Cap 301 as the suit premises is not a controlled tenancy and the Respondent shall at the earliest available opportunity apply to have this case struck out in limine.”

2. The reference by the Tenant to the Tribunal is premises on the basis that the Applicant/Tenant is a protected Tenant under the Act, Cap 301 of the Laws of Kenya.  The application by the Applicant dated 6th September 2021 at ground “A” states that the Applicant entered into a valid lease agreement with the Landlord for the lease of the Landlord’s premises known as LR No. 1870/1/204 and 1870/1/205 Westlands LR No. 122035 and 1870/1/205 Westlands LR No. 122035and 122036.

3. In the affidavit supporting the application, the Tenant/Applicant at paragraph 3 states;

“That the Tenant took up possession of the suit premises with the consent and authority of the Landlord.  The Landlord to date has failed to prepare a formal lease with me.”

4. The Respondent on its part has stated that by an agreement dated 19th March 2020, it leased the suit premises to the Tenant for a term of six years commencing 1st April 2018.   The lease agreement has been annexed to the Landlord’s affidavit.

5. The lease agreement referred to by the Respondent/Landlord is between the parties herein.  It has been executed by the representatives of the respective parties under seal.

6. The Tenant/Applicant has not disputed the validity of the lease agreement aforesaid, neither has the Applicant challenged the contents of the lease agreement and its execution.  The supporting affidavit of the Tenant/Applicant sworn by Renuka Shah makes reference to the same properties referred to in the lease (see paragraph 2 of the said affidavit).

7. In the circumstances, the position taken by the Applicant that the Respondent has failed to prepare a formal written agreement with the Tenant does not hold water.  I am persuaded that the tenancy between the parties herein is governed by the lease agreement dated 19th March 2020.

8. Under Section 2(1) of Cap 301, a controlled tenancy means a tenancy of shop, hotel or catering establishment;

a. Which has not been reduced into writing or

b. Which has been reduced into writing and which

i. Is for a period not exceeding five years or

ii. Contains provision for termination otherwise than for breach of covenant within five years from the commencement thereof or;

iii. Relates to premises of a class specified under subsection (2) of this section.

9. Section 12(4) of Cap 301 provides as follows;

“In addition to any other powers specifically conferred on it by us under this Act, a Tribunal may investigate any complaint relating to a controlled tenancy made to it by the Landlord or the Tenant and may make such orders thereon as it deems fit.

10. The jurisdiction of the Tribunal is clearly limited to controlled tenancies as provided under section 12(4) above and as defined under section 2(1) of Cap 301.  The lease agreement between the parties herein is for a period of six years.  I have gone through the same and it does not contain a termination clause otherwise than for breach of covenant within five years from the commencement thereof.  The lease agreement does therefore not give rise to a controlled tenancy between the parties in the premises of which this Tribunal lacks the requisite jurisdiction to hear and determine the dispute between the parties.

11. Having found that the Tribunal has no jurisdiction to hear and determine this dispute, the Tenant’s reference to the Tribunal dated 6th September 2021 is dismissed with costs to the Landlord/Respondent.

12. For the purpose of clarity, any other orders issued in this matter are hereby discharged.

HON. CYPRIAN MUGAMBI NGUTHARI

CHAIRMAN

BUSINESS PREMISES RENT TRIBUNAL

Ruling dated, signed and delivered virtually by Hon P. May this 16th day of February, 2022 in the absence of the parties.

HON. CYPRIAN MUGAMBI NGUTHARI

CHAIRMAN

BUSINESS PREMISES RENT TRIBUNAL