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Court of AppealDismissedCivil Appeal No. 218 of 2015· [2018] KECA 824 (KLR)

Dhirajlal J. Shah & another v Vijay Amritlal Shethia [2018] KECA 824 (KLR)

Court of Appeal
16 February 2018
RNR.N. NambuyePKP.O. KiageM'M'Inoti
4,976 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Court of Appeal confirmed that disputes over terminating business tenancies belong to the Rent Tribunal, not the Environment and Land Court.

What this practically means

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Executive summary

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The appellants, administrators of the estate of Juthalal Virpar Shah, issued the respondent with a notice terminating his verbal (and therefore controlled) tenancy of a Nairobi shop, effective 1st January 2014. Believing, on the strength of a letter from the chairman of the Business Premises Rent Tribunal dated 15th January 2014, that no reference had been filed against the notice, they filed an originating summons in the Environment and Land Court seeking vacant possession or eviction. The respondent asserted he had filed a reference (BPRT No. 741/2013) on 12th November 2013, and produced a later letter from the BPRT chairman dated 17th November 2014 confirming the filing, apologising for the Tribunal's failure to enter and serve it, and amending the earlier letter. The High Court (Gacheru, J.) stayed the suit pending determination of the reference before the BPRT. On appeal, the Court of Appeal framed two issues: whether the Judge erred in staying the OS pending the BPRT reference, and whether she had jurisdiction to conclusively determine the termination notice dispute. The Court held that the reference was filed timeously and paid for; that the statutory duty to serve it lay with the Tribunal, not the tenant; and that disputes arising from termination of controlled tenancy notices are exclusively within the BPRT's jurisdiction under section 12 of Cap 301 and are not enumerated in section 13 of the Environment and Land Court Act. Applying the Mbogo v Shah principles, the Court found the Judge exercised her discretion judiciously. It declined to pronounce on the alleged bias of the BPRT chairman, holding that concern belonged before the BPRT itself. The appeal was dismissed with costs to the respondent both in the appeal and the court below.

Key legal issues

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01

Whether the respondent timeously filed a reference before the BPRT opposing the termination notice

Holding

Yes. The BPRT chairman's letter of 17th November 2014, which superseded the earlier letter of 15th January 2014, confirmed the reference was filed on 12th November 2013 and paid for; the failure to serve it was the Tribunal's inadvertence, not the respondent's.

Reasoning

The uncontroverted documentation annexed to the respondent's replying affidavit, including the official receipt and the BPRT chairman's confirmation and apology, demonstrated that the reference BPRT No. 741/2013 was filed on 12th November 2013. Once filed, section 6(2) obligated the Tribunal to serve it on the landlords within seven days, and no supervisory role was vested in the tenant. The respondent therefore complied with section 6 and did not suffer the consequences stipulated in section 10 of the Act.

p. 5
02

Whether the Environment and Land Court had jurisdiction to conclusively determine issues touching on the termination notice within the OS

Holding

No. Termination of controlled tenancies is exclusively within the BPRT's mandate under section 12 of Cap 301; it is not enumerated among the matters in section 13 of the Environment and Land Court Act.

Reasoning

Article 162(2)(b) and section 13 of the Environment and Land Court Act confer jurisdiction over disputes relating to the environment and use, occupation of and title to land, but the provision does not list disputes arising from termination of tenancy notices. Their exclusion implies Parliament intended them to be catered for under the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, whose preamble and section 12 vest such disputes exclusively in the BPRT. The Judge was therefore right to stay the OS.

p. 6
03

Whether the Judge's discretion to stay the OS should be interfered with

Holding

No. Applying the Mbogo v Shah principles, the appellants did not demonstrate that the Judge misdirected herself or misapprehended the facts.

Reasoning

The appeal arose from the exercise of judicial discretion. Under Mbogo v Shah and United India Insurance Co. Ltd v East African Underwriters (Kenya) Ltd, interference is warranted only on established errors. On the record, the Judge correctly found that the reference was filed timeously, that the tenant bore no obligation to serve it, and that the court lacked jurisdiction over the termination notice dispute; she therefore acted judiciously in staying the OS and directing the parties to the BPRT.

p. 6

Legal principles established

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  • Termination of controlled tenancies and disputes arising from tenancy notices fall within the exclusive jurisdiction of the Business Premises Rent Tribunal under the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, and are not among the matters enumerated for the Environment and Land Court under section 13 of the Environment and Land Court Act.
  • A tenant who files a reference before the BPRT bears no obligation to ensure the Tribunal serves the reference on the landlord; service within seven days is the Tribunal's own statutory duty under section 6(2) of the Act, and the tenant cannot be faulted for the Tribunal's failure.
  • An appellate court will not interfere with a discretionary decision unless the judge misdirected himself, misapprehended the facts, took into account matters he should not have, failed to take into account matters he should have, or the decision is plainly wrong.
  • Where a court or tribunal lacks jurisdiction, it must stop proceedings at that point.

Court orders

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  1. 1.Appeal dismissed with costs to the respondent both on appeal and in the court below

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 162(2)(b)
  • Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, Cap 301Preamble; section 2(1)(a); section 4(1),(2),(4),(5); section 6(1),(2); section 10; section 11; section 12
  • Environment and Land Court Act, No. 19 of 2011Preamble; section 13
  • Law of Succession Act, Cap 160sections 83, 84 and 85
  • Civil Procedure Rulessection 6

Cases cited (3)

  • Mbogo versus Shah
    [1968] EA 93
  • United India Insurance Co. Ltd Versus East African Underwriters (Kenya) Ltd
    [1985] EA 898
  • Owners of the Motor Vessel 'Lillian S' versus Caltex Oil (Kenya) Ltd
    [1989] KLR 1
On appeal from
High Court of Kenya at Nairobi (Environment and Land Court)
ELC No. 683 of 2014 (O.S.)
Jurisdiction invoked
Appellate jurisdiction of the Court of Appeal under the Constitution and the Court of Appeal Act over a ruling of the High Court (Environment and Land Court established under Article 162(2)(b) of the Constitution and the Environment and Land Court Act No. 19 of 2011)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (6)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Dhirajlal J. Shah & another v Vijay Amritlal Shethia [2018] KECA 824 (KLR)", Case Analysis (2018). Civil Appeal No. 218 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/824/eng@2018-02-16

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.