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ELCDismissedMalindi ELC No. 5 of 2013 (Application dated 30th October 2014)· [2015] KEELC 195 (KLR)

Webwak Tradelink Ltd v Diamond Trust Bank Ltd & another [2015] KEELC 195 (KLR)

Environment and Land Court
9 October 2015
1,143 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan landowner lost his bid to stop a completed bank auction because courts refuse to relitigate issues already decided—and his real remedy is money damages.

What this practically means

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Executive summary

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The Plaintiff, a chargor who obtained a loan facility from the 1st Defendant in July 2010, applied by notice of motion dated 30th October 2014 for temporary injunctions restraining the Defendants from interfering with his quiet possession of six suit properties in Section IV Mainland North and from transferring them to the 2nd Defendant. He contended that the 1st Defendant had consented to a private treaty sale to one Benson Sande Ndete for Kshs.160,000,000, then unilaterally recanted and auctioned the properties on 22nd October 2014 to the 2nd Defendant for Kshs.135,000,000, unprocedurally and prematurely. The 1st Defendant responded that the same injunctive relief had already been sought and refused in Malindi HCCC No. 5 of 2013, by ruling of 11th April 2014, which held that the charged property becomes a commodity whose value and the chargor's loss are ascertainable, and that the Plaintiff's recourse lay in damages under section 97(1)(b) of the Land Act. The 2nd Defendant deponed that it was a bona fide purchaser for value. The court framed the first issue as whether the application was sub judice or res judicata. It held that the lawfulness of the public auction had been conclusively determined on 11th April 2014; the Plaintiff relied on the same grounds and had never appealed the earlier ruling. The court held the application was res judicata and an abuse of court process, the Plaintiff's remedy being ascertainable damages, and dismissed the application with costs on 9th October 2015.

Key legal issues

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01

Whether the application is res judicata

Holding

The application is res judicata and an abuse of court process because the same issues were conclusively determined by the court's ruling of 11th April 2014 in HCCC No. 5 of 2013

Reasoning

The Plaintiff had filed an earlier suit (HCCC No. 5 of 2013) against the 1st Defendant in which he sought identical injunctive relief over the same suit properties. That application was dismissed on 11th April 2014, with the court holding that the Plaintiff's recourse lay in damages under section 97(1)(b) of the Land Act. The Plaintiff relied on the same grounds in the present application and never appealed the earlier ruling, so the matter cannot be relitigated.

p. 3
02

Whether the Plaintiff is entitled to an injunction against the completed auction sale

Holding

No; the Plaintiff's remedy is damages, which are ascertainable

Reasoning

The auction took place on 22nd October 2014 pursuant to the court's ruling permitting the sale. Since the security property's value and the chargor's loss are ascertainable, damages are an adequate remedy. The Plaintiff also had a statutory recourse under section 97(1)(b) of the Land Act to seek an order that the sale is void, which does not entail stopping a completed sale by injunction.

p. 3

Legal principles established

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  • A plaintiff whose recourse lies in damages cannot file a second suit seeking an injunction to stop a sale already dealt with by a prior ruling, as such a suit is res judicata and an abuse of court process
  • Once a property is offered by the chargor as security, it becomes a commodity whose value is ascertainable and the chargor's loss is ascertainable even if the sale is later found improper or irregular

Court orders

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  1. 1.Dismissal of the Plaintiff's Application dated 30th October 2014
  2. 2.Costs of the application to the Defendants

Authorities

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Legislation

  • Land ActSection 97(1)(b)
Jurisdiction invoked
Original civil jurisdiction of the Environment and Land Court (interlocutory application within HCCC No. 5 of 2013 matter)

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, "Webwak Tradelink Ltd v Diamond Trust Bank Ltd & another [2015] KEELC 195 (KLR)", Case Analysis (2015). Malindi ELC No. 5 of 2013 (Application dated 30th October 2014). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2015/195/eng@2015-10-09

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