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ELCAllowedNot stated in judgment· [2017] KEELC 2520 (KLR)

Playstreet Kindergarten Ltd v All Africa Conference of Churches & Registered Trustees [2017] KEELC 2520 (KLR)

High Court of Kenya
28 June 2017
KBK. BOR
1,160 words in judgment
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The bottom line

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What this practically means

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Executive summary

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The Defendant, an international organisation with diplomatic status in Kenya, applied for review of an injunctive order issued on 18th December 2015 restraining it from levying distress, evicting, developing, demolishing, alienating or interfering with the Plaintiff's occupation of L.R. No. 1/305 Dennis Pritt Road pending determination of the suit. The Defendant argued there was an error on the face of the record because the injunction rested on an undated, unregistered lease, and that the order prevented it from selling its own property at a time of financial difficulty, notwithstanding that the identified purchaser was willing to take the property subject to the Plaintiff's lease. The Plaintiff opposed, contending that the Defendant was estopped from denying the lease, and relied on authorities on the effect of non-registration, which the court noted made the tenant a periodic/monthly tenant. The Defendant relied on Sections 4 and 18 of the Registration of Documents Act and Garibi Ltd v Ogilvi East Africa Ltd. Framing the issue as whether a tenant can restrict a landlord from disposing of its property, the court found no covenant in the lease barring sale and held that the alienation limb of the injunction was an error apparent on the face of the record, since the Plaintiff's grievance related only to an eviction notice and rent arrears. The court allowed the review, deleting 'alienating' from the order so the Defendant could sell subject to the lease expiring on 31st December 2018, and awarded the Defendant the costs of the application. Judgment delivered at Nairobi on 28th June 2017 by K. Bor, Judge.

Key legal issues

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01

Whether an unregistered lease is admissible in evidence and its effect on the parties' relationship

Holding

The court noted the dispute over registration but rested its decision on the scope of the injunction; the lease, stamped on 13th February 2014, runs until 31st December 2018, and the authorities cited dealt with non-registration converting the relationship into a periodic tenancy.

Reasoning

Both parties cited authorities on the effect of non-registration of a lease: the Plaintiff's authorities showed a tenant becomes a monthly tenant where a lease is unregistered, while the Defendant's authority showed an unregistered agreement becomes void after the first year, creating a periodic tenancy terminable by a month's notice. The court did not finally resolve admissibility but found sufficient reason on the face of the record to vary the alienation limb of the injunction.

p. 2
02

Whether a tenant can restrict a landlord from disposing of the landlord's property

Holding

No. There is no covenant in the lease restraining sale; the landlord's absolute ownership is vested by Section 24(a) of the Land Act, and the implied landlord covenants under Section 65 of the Land Act do not bar disposal.

Reasoning

The court examined Clause 2 of the lease and the implied covenants under Section 65 of the Land Act, finding no obligation on the Defendant not to sell. Since ownership was not disputed and the purchaser was willing to take subject to the Plaintiff's lease, restraining alienation was an error apparent on the face of the record and the order was varied to delete 'alienating'.

p. 2

Legal principles established

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  • Review jurisdiction under Section 80 of the Civil Procedure Act and Order 45 Rule 1(1) may be invoked on grounds of discovery of new matter, error apparent on the face of the record, or any other sufficient reason.
  • An injunction should not restrain a landlord from alienating property where the tenancy agreement contains no covenant against sale and the tenant's grievance relates only to eviction and rent arrears.

Court orders

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  1. 1.The application for review is allowed on the terms that the word 'alienating' is removed from the order of 18th December 2015, permitting the Defendant to dispose of the Suit Property
  2. 2.The Defendant is permitted to sell the Suit Property subject to the Plaintiff's lease, which determines on 31st December 2018
  3. 3.The Defendant will have the costs of this application

Authorities

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Legislation

  • Civil Procedure ActSection 3A
  • Civil Procedure ActSection 80
  • Civil Procedure RulesOrder 45 Rule 1(1)
  • Registration of Documents ActSection 18
  • Registration of Documents ActSection 4
  • Land ActSection 65
  • Land ActSection 24(a)

Cases cited (3)

  • Chon Jeuk Suk Kim and another V E.J. Austin & 2 others
    (2013) eKLR
  • Bachelors Bakery Ltd V Westlands Securities Ltd
    (1982) eKLR
  • Garibi Ltd V Ogilvi East Africa Ltd
    (2014) eKLR
Jurisdiction invoked
Sections 3A and 80 of the Civil Procedure Act and Order 45 Rule 1(1) of the Civil Procedure Rules (review)

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, "Playstreet Kindergarten Ltd v All Africa Conference of Churches & Registered Trustees [2017] KEELC 2520 (KLR)", Case Analysis (2017). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/2520/eng@2017-06-28

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