Patricia Achieng Onyango & another (suing as the legal rep. of Dismas Juma Onyango Kamb) v Meridien Biao Bank Limited (In Liquidation) [2017] KEELC 1713 (KLR)
The bottom line
#A Kenyan court blocked the auction of a family home because the bank's statutory notice was defective and improperly served on a deceased person.
What this practically means
#Executive summary
#Key legal issues
#Validity of the statutory notice under section 90 of the Land Act, 2012
The statutory notice was defective: it was purportedly served in 2012 on a chargor who died in 2006, and the applicant only received a 45-day auctioneer's notice, contrary to the statutory minimums.
Section 90(1) requires written notice with the chargor given at least one month plus two months to comply, and section 96(2) requires a 40-day notice to sell before completing any sale contract. The defendant's own affidavit showed the deceased died in 2006, six years before the 2012 notice, and the applicant was unaware of it until 2015. Relying on David Ngugi Ngaari v KCB, the court found the notice did not comply with section 90(1) and was defective.
Prima facie case and clogging of the equity of redemption
The plaintiff established a prima facie case with a probability of success; allegations of fraud and tripartite agreement breaches are matters for trial, and sale without proper notice would clog the equity of redemption.
The applicant contended the deceased's title was offered temporarily under a tripartite agreement and should have been discharged when the third party substituted securities, which the respondent failed to do. The court held that fraud and third-party agreement issues are best suited for trial, and that a sale carried through absent a proper notice to sell would amount to a clog on the chargor's equity of redemption, so the threshold in Giella v Cassman Brown was met.
Irreparable harm and balance of convenience
The suit property is the applicant's matrimonial home; its sale before trial would cause irreparable loss not compensable in damages, and the balance of convenience favours maintaining the status quo.
Following Notco (Mombasa) Limited v Halima Bakari Ramadhani, a long-standing family home carries sentimental value that money cannot replace. Since the applicant resides in the property with her children, sale before determination of the disputed issues would render any eventual remedy hollow; hence preservation by maintaining the status quo preceding the threatened realization of security was appropriate.
Legal principles established
#- A statutory notice served on a chargor who was already deceased, with notice periods shorter than the statutory minimum, is defective and cannot ground a sale of the charged property.
- Sale of charged property without a proper notice to sell amounts to a clog on the chargor's equity of redemption.
- A matrimonial home has a value beyond economic measurement and its sale before trial would cause irreparable loss not compensable in damages.
Court orders
#- 1.Notice of Motion dated 4th September 2015 allowed entirely with costs in the cause
- 2.Interlocutory injunction restraining the Respondent from selling, transferring, disposing, wasting, alienating or encumbering L.R Number Nairobi/Block 103/163, Mugoya Estate, South C, pending hearing and determination of the suit
- 3.Maintenance of status quo prevailing before the Defendant threatened to realize the security
- 4.Plaintiff directed to take out Summons and serve them upon the Defendant, which to enter appearance and file its Defence
- 5.Parties to comply with Order 11 of the Civil Procedure Act to prepare the suit for hearing
- Jurisdiction invoked
- Sections 3A and 63(c) of the Civil Procedure Act, Cap 21 and Section 13 of the Environment and Land Court Act, Cap 12A; Order 51 Rule 1 and Order 40 Rules 1, 2, 3, 4 and 8
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (2)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Stars and Garters Restaurant & another v National Bank of Kenya Limited[2019] KEHC 7390 (KLR)23 May 2019
- Stars and Garters Restaurant & another v National Bank of Kenya Limited[2019] KEHC 7390 (KLR)23 May 2019
Cite this brief
#Cite this brief
Caselaw, "Patricia Achieng Onyango & another (suing as the legal rep. of Dismas Juma Onyango Kamb) v Meridien Biao Bank Limited (In Liquidation) [2017] KEELC 1713 (KLR)", Case Analysis (2017). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/1713/eng@2017-09-07
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.