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ELCDismissedNot stated in the judgment (Nakuru ELC suit filed 2nd June 2016)· [2017] KEELC 2800 (KLR)

Jiinue Holdings Limited v Housing Finance Corporation of Kenya & another [2017] KEELC 2800 (KLR)

Environment and Land Court
31 May 2017
DOD. O. Ohungo
1,292 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court refused to stop a property auction because the borrower's own director had signed for the required notices, proving the bank followed the law.

What this practically means

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Executive summary

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The plaintiff company, which had obtained a Ksh.15 million loan from the 1st defendant secured by a charge over Nakuru Municipality Block 1/6 (Langalanga), sued on 2nd June 2016 seeking an injunction to restrain the defendants from selling the property and a declaration that the intended public auction was illegal, alleging that statutory and redemption notices were never served. Contemporaneously it moved for an interlocutory injunction by Notice of Motion dated 3rd June 2016. The defendants, through a statement of defence and the replying affidavit of Martin Wachira, asserted that after default a statutory notice issued on 15th May 2015 and was sent by registered post; a demand notice followed on 31st August 2015; and a 45-day redemption notice and notification of sale issued on 4th April 2016 and were received and signed by the plaintiff's director, Zachary Waweru Ireri, who later sought an indulgence. The property was advertised in the Daily Nation of 23rd May 2016 after a forced sale valuation by Gimco Limited. Counsel for the plaintiff relied wholly on the pleadings and affidavit and made no submissions; the plaintiff filed no further affidavit to controvert the defendants' evidence. Applying Giella v Cassman Brown as clarified in Nguruman Limited v Jan Bonde Nielsen, the court held that no prima facie case with probability of success was established, and since the first hurdle failed, the remaining limbs need not be considered. The Notice of Motion was dismissed with costs on 31st May 2017.

Key legal issues

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01

Whether the plaintiff established a prima facie case for an interlocutory injunction restraining exercise of the statutory power of sale

Holding

No prima facie case was established; the defendants' material showed default and due issuance of the statutory notice, 45-day redemption notice and notification of sale, received and signed by the plaintiff's director, who even sought an indulgence thereafter

Reasoning

The court applied Giella v Cassman Brown as clarified in Nguruman Limited v Jan Bonde Nielsen, stressing the sequential hurdles. The plaintiff alleged non-service of notices but filed no further affidavit to controvert the defendants' evidence of service by registered post and personal receipt. The court declined to hold a mini-trial, leaving full merits to trial. Failing the first limb, the other Giella limbs fell away.

p. 2

Legal principles established

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  • The three Giella v Cassman Brown principles for interlocutory injunctions must be surmounted sequentially; once prima facie case fails, the other limbs need not be considered

Court orders

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  1. 1.The Notice of Motion dated 3rd June 2016 is dismissed with costs

Authorities

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Cases cited (3)

  • Giella –vs- Cassman Brown & Co. Ltd
    [1973] E.A 358
  • Nguruman Limited –vs- Jan Bonde Nielsen & 2 Others
    [2014] eKLR
  • Kenya Commercial Finance co. Ltd –vs- Afraha Education Society
    (2001) Vol. 1 EA 86
Jurisdiction invoked
Original jurisdiction of the Environment and Land Court over land disputes; injunction application under the plaint filed 2nd June 2016 (no specific constitutional/statutory provision invoked in the ruling)

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, "Jiinue Holdings Limited v Housing Finance Corporation of Kenya & another [2017] KEELC 2800 (KLR)", Case Analysis (2017). Not stated in the judgment (Nakuru ELC suit filed 2nd June 2016). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/2800/eng@2017-05-31

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