Wycliffe Mutali Okwaro v Kenya Women Micro Finance Bank Ltd & another [2017] KEELC 1184 (KLR)
The bottom line
#An Eldoret court allowed KCB to proceed toward selling land charged as loan security, ruling matrimonial property gets no special protection once offered as collateral.
What this practically means
#Executive summary
#Key legal issues
#Whether a prima facie case was established
No prima facie case was established; default was admitted, notices were properly issued and served
The court held it was not in dispute that the applicant guaranteed the 2nd defendant's Kshs 1.4M loan and that she defaulted. The chargee issued and served statutory notices under sections 90 and 96 of the Land Act addressing both the guarantor and defaulter. Having complied with the law, the chargee's right to realize the security could not be restrained, and the applicant, being in default himself, had not shown a probability of success.
Whether matrimonial character of the charged property blocks realization
No; once offered as security it is treated like any other security
Relying on the Maltex Commercial Supplies case, the court held that property offered as security, whether matrimonial or otherwise, stands the risk of sale on default. The sentiment of ownership has given way to commercial considerations, and the applicant cannot invoke the empathy of the court based on the matrimonial character of the property. The argument was characterized as dead on arrival.
Whether the applicant came to equity with clean hands
The applicant was not candid; a defaulting guarantor will not be granted the equitable remedy of injunction
The court questioned the relationship between the plaintiff and the 2nd defendant and why he would sue her over refusal to repay, noting he claimed to have been assisting in repayment yet did not know the state of the account. Relying on the Daniel Kamau Mugambi and Ichatha authorities, the court held that a plaintiff who seeks protection from the consequences of his own default does not come with clean hands and cannot be granted an injunction.
Legal principles established
#- Matrimonial property offered as security is treated like any other security on default and does not acquire special protection from realization
- If the applicant fails to establish a prima facie case, the court need not consider the remaining Giella conditions
- Legal authorities should be cited in submissions or oral argument, not in affidavits
Court orders
#- 1.The plaintiff's application dated 9th March 2017 is dismissed with costs to the 1st defendant
- 2.Parties to comply with Order 11 within 30 days and set down the suit for hearing
- Jurisdiction invoked
- Inherent jurisdiction of the court to grant interlocutory relief under the Giella principles; charge registered over land parcel Eldoret Municipality Block 21 (King'ong'o)/3854
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Manil Limited v Friends that Care Holding Company [2019] KEELC 2257 (KLR)[2019] KEELC 2257 (KLR)18 Jul 2019
Cite this brief
#Cite this brief
Caselaw, "Wycliffe Mutali Okwaro v Kenya Women Micro Finance Bank Ltd & another [2017] KEELC 1184 (KLR)", Case Analysis (2017). Notice of Motion dated 9th March 2017 (ELC suit, Eldoret). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/1184/eng@2017-10-30
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.