Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
Caselaw
AI-generated case brief
Case Brief · caselaw.co.ke
ELCDismissed· [2017] KEELC 833 (KLR)

Lucy Wanjiku Muchiri & another v Sumac Microfinance Limited [2017] KEELC 833 (KLR)

Environment and Land Court
7 November 2017
EOE. O. Obaga
1,222 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~5 min to read original · ~4 min brief

The bottom line

#

What this practically means

#

Executive summary

#
The applicants moved the court by notice of motion dated 28th March 2017 seeking a temporary injunction restraining the respondent from dealing in any manner with Title Number Nairobi/Block 82/522 pending the hearing and determination of the suit. The respondent had extended a facility of Kshs 11,500,000 repayable over 36 months at 20% interest on a reducing balance, secured by a charge over the first applicant's title. Following default, the respondent issued a three-month statutory notice and moved to realise the security. The applicants claimed they had repaid the entire principal and disputed the interest demanded, complaining that accounts were not forthcoming, and warned of irreparable loss if the property were sold. The respondent maintained that deposits were insufficient to service the loan, that statements had always been issued, and that the applicants' affidavits were internally contradictory on whether the principal was cleared or only substantially paid. Applying the Giella v Cassman Brown principles and Mrao's definition of a prima facie case, the court held that the applicants failed to demonstrate a prima facie case with probability of success, noting that a dispute over interest or accounts is not a ground for an injunction. Further, damages were an adequate remedy, the chargor having knowingly offered the property as security. The application was dismissed with costs to the respondent.

Key legal issues

#
01

Prima facie case with probability of success

Holding

The applicants failed to establish a prima facie case as they could not show they were not in arrears

Reasoning

The applicants claimed the principal sum was cleared yet their own affidavit contradicted itself, stating in one place that the principal was cleared and in another that it was substantially paid. The respondent annexed statements issued to the second applicant. The applicants offered no evidence that they were not in arrears, and the chargee could realise security upon default.

p. 2
02

Adequacy of damages as an alternative remedy

Holding

Damages are an adequate remedy, so no injunction should issue even under the second Giella principle

Reasoning

The first applicant knowingly offered her property as security for the second applicant's loan and was aware of the consequences of default. If the respondent were at fault in realising the security, the applicants could be compensated in damages. Following Lord Diplock's speech in American Cyanamid v Ethicon, where damages are adequate, no interlocutory injunction should normally issue.

p. 3

Legal principles established

#
  • A dispute on interest or accounts is not a ground for granting an injunction to restrain a chargee from realising security

Court orders

#
  1. 1.The applicants' notice of motion dated 28th March 2017 is dismissed
  2. 2.Costs of the application to the respondent

Authorities

#

Cases cited (5)

  • Giella Vs Cassman Brown & Co.
    [1973] KLR 358
  • Mrao – vs – First American Bank of Kenya Ltd. & 2 Others
    [2003] KLR 125
  • Alternative Media Ltd. –vs- Safaricom Ltd.
    [2004] eKLR
  • Mureithi –vs- City Council of Nairobi
    [1979] 12 (C.A.K)
  • American Cynamid Co. –vs- Ethicon
    [1975] ALL ER 504
Jurisdiction invoked
Original civil jurisdiction; the suit concerns a charge over land title Nairobi/Block 82/522

Key timeline

#

Practical implications

#

Frequently asked questions

#

Cite this brief

#

Cite this brief

Caselaw, "Lucy Wanjiku Muchiri & another v Sumac Microfinance Limited [2017] KEELC 833 (KLR)", Case Analysis (2017). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/833/eng@2017-11-07

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