Benard Kiptarus v National Bank Of Kenya & Others [2014] KEELC 297 (KLR)
The bottom line
#The High Court in Kitale dismissed a guarantor's bid to stop dealings in his repossessed land, holding that once a bank sells and transfers property, the owner's only remedy is money compensation.
What this practically means
#Executive summary
#Key legal issues
#Whether the applicant demonstrated a prima facie case with a probability of success
He did not; the property had been sold and registered in the 2nd defendant's name, extinguishing the chargor's rights
The court applied the settled Giella principles for interlocutory injunctions. It reasoned that upon exercise of the statutory power of sale and transfer to a third party, the chargor's rights are extinguished regardless of whether the power of sale was exercised improperly, and the remedy lies solely in damages. The prayers in the plaint, which sought declarations that the power of sale had expired and that the transfer was fraudulent, could not support a prima facie case given that position.
Whether the applicant would suffer irreparable injury not compensable in damages
He would not; the value of the security was quantifiable and compensable
The applicant had offered his property as security for a loan, a value had been placed on it, and any loss upon losing the land was therefore quantifiable and capable of compensation in damages. Having failed on the first and second limbs of the injunction test, the court declined to consider the third limb, the balance of convenience.
Legal principles established
#- Once a chargee exercises its statutory power of sale and the property is transferred to a third party, the chargor's rights are extinguished and the only remedy is in damages
- Loss following a validly valued security is quantifiable and compensable in damages, defeating an injunction claim
Court orders
#- 1.Dismissal of the application dated 15/1/2014 seeking inhibition
- 2.Dismissal of the application dated 3/2/2014 seeking a temporary injunction
- 3.Costs of both applications awarded to the 1st, 2nd and 3rd respondents
- Jurisdiction invoked
- Original civil jurisdiction of the High Court over a land dispute concerning Parcel No. Nandi/Keben/135
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Benard Kiptarus v National Bank Of Kenya & Others [2014] KEELC 297 (KLR)", Case Analysis (2014). Not stated in the judgment (two applications dated 15/1/2014 and 3/2/2014 in the suit). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2014/297/eng@2014-07-22
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.