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ELCDismissedNotice of Motion dated 17th January 2017 (suit not numbered in the ruling)· [2017] KEELC 1745 (KLR)

Zacharia Ndinguri Mwangi v Wananchi Sacco Society Limited [2017] KEELC 1745 (KLR)

High Court of Kenya
29 September 2017
DOD. O. Ohungo
1,218 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A borrower who is not the registered owner or chargor of a charged property cannot stop a Kenyan bank from selling it through an injunction.

What this practically means

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Executive summary

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The plaintiff moved the court by Notice of Motion dated 17th January 2017, seeking an interlocutory injunction to restrain the defendant bank from dealing with Title Nos. SUBUKIA/SUBUKIA BLOCK 13/1468 and SUBUKIA/SUBUKIA WEST BLOCK 1/18 pending the hearing of the suit, invoked under sections 1A, 1B and 3A of the Civil Procedure Act. He deposed that he borrowed KShs 1,800,000 from the defendant, secured by the first property, and that the second property secured a loan to his wife; both were charged to the defendant. He alleged the defendant instructed auctioneers to sell the properties without serving a statutory notice, though a 45-day redemption notice and notification of sale were personally served on him on 4th November 2016 for a sale scheduled for 9th January 2017. The defendant, through the replying affidavit of Martin Mwangi, acknowledged the loan but maintained that both properties are registered in the name of James Mwangi Ndinguri, who is also the chargor, that the borrower on the second property was Miriam Wacera Macharia (not a party), and that the plaintiff was in default, prompting a statutory notice dated 12th August 2016 and instructions to Jomuki Auctioneers. The court applied the Giella v Cassman Brown principles. It found the plaintiff had shown no documentary proof of ownership, that he was neither registered proprietor nor chargor of either property, and that, absent complaint by the chargor, he could not stand in the chargor's place to stop the statutory power of sale. The plaintiff's own letter of 3rd October 2016 admitted arrears. Applying Nguruman, once no prima facie case was established the other limbs fell away. The Notice of Motion was dismissed with costs.

Key legal issues

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01

Whether the plaintiff established a prima facie case with a probability of success under the Giella v Cassman Brown test

Holding

No - the plaintiff, though the borrower, was neither the registered owner nor the chargor of either property, and was in default on the loan.

Reasoning

The plaintiff deposed ownership of both properties but produced no documentary proof. The defendant exhibited titles and charge documents showing James Mwangi Ndinguri as registered owner and chargor; the borrower on the second property was Miriam Wacera Macharia, not a party. The plaintiff also admitted arrears in his letter of 3rd October 2016. Without a complaint by the chargor, he could not stop the statutory power of sale.

p. 2

Legal principles established

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  • A plaintiff who is neither the registered proprietor nor the chargor cannot stand in the chargor's place to restrain exercise of the statutory power of sale, absent complaint by the chargor.
  • If a prima facie case is not established, the remaining Giella limbs need not be considered.

Court orders

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  1. 1.Notice of Motion dated 17th January 2017 dismissed with costs

Authorities

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Legislation

  • Civil Procedure Actsections 1A, 1B and 3A

Cases cited (3)

  • Giella –vs- Cassman Brown & Co. Ltd
    [1973] E.A 358
  • Mrao Ltd v First American Bank of Kenya Ltd & 2 others
    [2003] eKLR
  • Nguruman Limited –vs- Jan Bonde Nielsen & 2 Others
    [2014] eKLR
Jurisdiction invoked
Sections 1A, 1B and 3A of the Civil Procedure Act

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, "Zacharia Ndinguri Mwangi v Wananchi Sacco Society Limited [2017] KEELC 1745 (KLR)", Case Analysis (2017). Notice of Motion dated 17th January 2017 (suit not numbered in the ruling). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/1745/eng@2017-09-29

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