Upperview Properties Limited v Imperial Bank Limited (In Receivership) [2017] KEELC 1390 (KLR)
The bottom line
#Kenya's High Court ordered Imperial Bank, in receivership, to keep paying rent to KCB while a property ownership dispute goes to trial.
What this practically means
#Executive summary
#Key legal issues
#Whether the applicant established a prima facie case with a probability of success
Yes - on the face of the certificate of lease the applicant, as registered owner, has a prima facie case; the court made no conclusive finding on ownership given the fraud allegations requiring trial
The applicant produced a certificate of lease showing it is the registered proprietor of the suit property. Although the respondent alleged the title was acquired through fraudulently declared dividends, conclusive investigations were not complete and fraud issues require evidence and cross-examination at a full trial. The court therefore declined to make conclusive findings on proprietorship but found the registered owner had a prima facie case with a probability of success.
Whether the applicant would suffer irreparable harm if the injunction is not granted
Yes - the applicant is servicing the KCB charge while the respondent enjoys possession, and non-payment risks foreclosure
The suit property is charged to Kenya Commercial Bank for a loan of Kshs. 250,000,000 and rent was assigned to the bank. If rents are not remitted, the applicant continues servicing the loan while the respondent occupies the property, and the debt could balloon through interest and penalties, enabling the chargor to exercise its statutory power of sale before the hearing of the suit, occasioning the applicant irreparable harm.
Whether special circumstances exist warranting a mandatory injunction at the interlocutory stage, and where the balance of convenience lies
Yes - the case is simple and summary since the landlord-tenant relationship has not been terminated by any court, and refusing payment would allow the respondent to steal a march; preservation of the property serves both parties
No court or tribunal has declared the landlord-tenant relationship illegal or terminated it, and even without a signed new lease the relationship continues under the Land Act on the basis of the previous mode of rent payment. If the charge is not serviced, interest and penalties would balloon and the statutory power of sale could be exercised before trial, equating to stealing a march. Preservation of the suit property is in the interest of both sides.
Legal principles established
#- A mandatory injunction can be granted on an interlocutory application in the absence of special circumstances only where the case is clear and ought to be decided at once, the act done is simple and summary and easily remedied, or the defendant attempted to steal a march on the plaintiff
- Before granting a mandatory injunction the court must feel a high sense of assurance that at the trial the injunction would appear to have been rightly granted, a higher standard than for a prohibitory injunction
- The decision to grant a mandatory injunction at the interlocutory stage depends on the discretion of the judge, decided on the peculiar facts of each case
- A trial court must avoid making conclusive findings of fact before they are tested in cross-examination
Court orders
#- 1.A mandatory injunction issued in terms of prayer No. 5 of the motion, compelling the Respondent pending the hearing and determination of the suit to pay the rents due in respect of its tenancy of the suit property Mombasa/Block XXVI/25 to the Kenya Commercial Bank Limited, the chargor of the suit property
- 2.Each party to meet their respective costs of the application
- Jurisdiction invoked
- Sections 3, 3A and 63(e) of the Civil Procedure Act, Cap 21 Laws of Kenya and Order 40 Rules 1, 2, 4, 11 of the Civil Procedure Rules
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Upperview Properties Limited v Imperial Bank Limited (In Receivership) [2017] KEELC 1390 (KLR)", Case Analysis (2017). Application dated 2nd February 2017 in HCCC (Mombasa). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/1390/eng@2017-10-13
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.