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ELCPartially AllowedEldoret HCCC (injunction application within suit; suit number not stated in judgment)· [2013] KEELC 120 (KLR)

Eliazer Kiprugut Kosgei v Barclays Bank of Kenya & another [2013] KEELC 120 (KLR)

Environment and Land Court (then High Court, Environment and Land division) at Eldoret
10 July 2013
3,666 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court stopped Barclays from selling a farmer's land because the bank had no Land Control Board consent for the charge.

What this practically means

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Executive summary

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The plaintiff, registered proprietor of agricultural land parcel Moi's Bridge/Sirikwa Block 2 (Ziwa)/51, moved the court by Motion dated 14 February 2012 under Order 40 Rules 1 and 2 of the Civil Procedure Rules and Section 3A of the Civil Procedure Act, seeking an interlocutory injunction restraining the 1st defendant bank, Barclays Bank of Kenya Ltd, and the 2nd defendant auctioneer, Dalali Auctioneers, from offering the suit land for sale by public auction scheduled for 16 February 2012. The plaintiff contended that the charge securing Kshs 2 million was void because no Land Control Board consent was obtained; that no valid statutory notice or notification of sale was served; that no reserve price was disclosed; and that the auction, scheduled in the private offices of another auctioneer, would not be a public auction. The defendants asserted that consent was issued on 19 March 2009, that statutory notices, a 45-day redemption notice and notification of sale were duly served, that the auctioneer held a Class B licence, and that the plaintiff was indebted and in arrears. The court applied the Giella v Cassman Brown principles. Noting the absence of any minute of consent in the board's minutes of 19 March 2009, the court held the plaintiff had demonstrated a prima facie case with probability of success, and irreparable loss. An injunction issued restraining the 1st defendant from selling or dealing with the suit land until final determination, with costs of the application to the plaintiff.

Key legal issues

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01

Prima facie case for interlocutory injunction

Holding

Plaintiff demonstrated a prima facie case with probability of success based on absence of land control consent

Reasoning

The court applied Giella v Cassman Brown. The suit land is undisputedly agricultural land in a land control area; Section 6(1) of the Land Control Act renders a charge over such land void for all purposes without board consent. The minutes of the alleged consent meeting of 19 March 2009 contained no entry for the suit land, while the bank produced the consent but no minutes. This established a prima facie case.

p. 6
02

Irreparable loss

Holding

Plaintiff would suffer irreparable loss if the land were sold

Reasoning

The court found that damages would not adequately compensate the loss of the suit land, which the plaintiff described as the only home he knows. Having found a prima facie case and irreparable loss, the Giella test was satisfied and an injunction followed.

p. 6
03

Statutory notices and auction conduct

Holding

Notices appeared duly issued and the auctioneer appeared authorized, but these were preliminary views open to reconsideration

Reasoning

The court noted service of a Section 74(1) and (2) Registered Land Act statutory notice, a 45-day redemption notice and notification of sale under the Auctioneers Rules 1997, and a certificate of service. It also gave the auctioneer, holder of a Class B licence, the benefit of the doubt and viewed an office accessible to the public as capable of hosting a public auction, all without final determination.

p. 4
04

Default and statutory power of sale

Holding

The plaintiff was in arrears, entitling the bank to exercise its statutory power of sale, subject to validity of the charge

Reasoning

The plaintiff's bare assertion of repayment was unsupported; account statements showed arrears. The court accepted the bank was entitled to exercise its statutory power of sale, but this right was predicated on a valid charge, which was impugned for want of land control consent.

p. 4

Legal principles established

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  • A charge over agricultural land within a land control area is void for all purposes unless the land control board has given its consent
  • Where the board's minutes contain no entry of consent, prima facie no consent was issued, and the party asserting consent should produce the minutes

Court orders

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  1. 1.An order of injunction restraining the 1st defendant, by itself or through its servants/agents, from offering for sale or selling the suit land until final determination of the suit
  2. 2.An order barring the 1st defendant, by itself or through its servants/agents, from dealing in any other way with the suit land until final determination of the suit
  3. 3.Costs of the application awarded to the plaintiff

Authorities

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Legislation

  • Civil Procedure RulesOrder 40 Rules 1 and 2
  • Civil Procedure ActSection 3A
  • Registered Land Act (CAP 300) (repealed)Sections 65(2), 74(1) and (2), 77(6)
  • Land Control Act (CAP 302)Sections 2, 6(1)
  • Auctioneers Actnot specified
  • Auctioneers RulesRules 15(b), 15(c); 45-day redemption notice
  • Development and Use of Land (Planning) Regulations1961 Regulations (referred to in Section 6(1))

Cases cited (6)

  • Giella v Cassman Brown
    (1973) EA 358
  • John Muriu Gache v Kama Njuguna & Another
    HCCA No. 64 of 1992
  • William Ocharo Maangi vs Joseph Onyoni Kombo
    CA No. 18 of 1995
  • Lucky Summer Estate Co Ltd & 3 Others vs Kariuki & another
    HCCC No 2587 of 1994
  • Omolo v Small Enterprises Finance Co. Limited & Another
    HCCC No. 232 of 1996
  • Felix & 2 others vs Voi Development Company Limited & 4 others
    HCCC No. 566 of 1999
Jurisdiction invoked
Order 40 Rules 1 and 2 of the Civil Procedure Rules and Section 3A of the Civil Procedure Act, CAP 21, Laws of Kenya

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Eliazer Kiprugut Kosgei v Barclays Bank of Kenya & another [2013] KEELC 120 (KLR)", Case Analysis (2013). Eldoret HCCC (injunction application within suit; suit number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2013/120/eng@2013-07-10

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